Power prices should start to come down: Consumer NZ

The NZ Energy Quarterly showed the average per unit charge for households rose 3% in the year to September. Photo / Thinkstock

Consumer NZ says power prices for Kiwi households should fall after years of relentless increases including a 3 per cent annual rise revealed in the latest official data.

The New Zealand Energy Quarterly, released just before Christmas, showed the average per unit charge for households rose 3 per cent in the year to September. That added $64 to the average annual household power bill and the increase outpaced growth in wages and salaries and inflation over the same period.

Consumer NZ chief executive Sue Chetwin said the $64 a year average lift in household power bills was significant given it was in excess of inflation and wage growth.

"It comes on top of years of rising prices so it's not as if this is a one-off and households can absorb that easily. What we should be seeing if this was a proper competitive market - and we keep being told that it is - is that prices should come down.

"There is still room for electricity prices to basically reflect the competition that's out there and they're still not doing that. I think that will change this year and two of the retailers have already said that they're going to hold their prices."

Mighty River Power said last month that it was committed to no increase in headline energy prices for its residential electricity and gas customers until at least April 1, 2015.

Labour MP Moana Mackey said with flattening electricity demand and an oversupply of generation, "if power prices aren't going down now they're never going to go down".

"What this shows is there is something fundamentally wrong with the electricity system in New Zealand."

Senior Cabinet minister Nick Smith said he was encouraged by the "relatively low" increase. "I'm more concerned that there was year on year right through last decade 8 per cent per year increases in residential power prices. So a 3 per cent increase would be one of the lowest annual increases in many years."