Rewards for power saving

By JOSIE CLARKE

Mercury Energy will credit customers who cut their power use over the next two months in an effort to encourage households and small businesses to save energy.

The electricity retailer's domestic and small commercial customers will receive credits if their power bills in July and August are lower than their bill for June.

It will credit customers 5c for every unit they save based on the number of units they used in June.

Mercury general manager John Foote said the campaign was designed to reduce the possibility of national electricity supply problems caused by low lake levels and high demand brought on by the cold weather.

The announcement follows Energy Minister Pete Hodgson's call 10 days ago for power companies to pay customers to save energy to avoid the possibility of blackouts.

Mr Foote estimated the bill for an average user who saved 60 units, or 10 per cent, could drop by a total of $10, including the credit. Those with a power bill of $200 who managed to cut their bill by 20 per cent could save $60.

Most customers would save between $5 and $20 a month.

The offer follows an information campaign teaching people how to conserve power. Tips included turning off heated towel rails, taking shorter showers and switching off heaters for an hour a day.

But Mr Foote said customers should be sensible when saving power. "Clearly, we are not suggesting or advocating people cut down on power for cooking, heating and lighting."

Mercury has promised it will not raise electricity prices for domestic and small commercial customers in the Vector network this winter.

Mr Foote said wholesale prices remained very high.

"Obviously if prices stay high and there isn't some energy conservation, we are a bit afraid that prices will stay high for quite a long time and that could eventually force retailers to start increasing costs."

Lake levels are still below average but are nowhere near the lows experienced during the 1992 crisis.

Energy analyst and consumer advocate Molly Melhuish praised Mercury's incentive.

Green co-leader Jeanette Fitzsimons also welcomed the campaign and hoped other retailers would follow, but she said the scheme should not be conditional on lake levels and power demand.

"We would like to see this type of scheme extended all year round, even when lake levels are high and the weather is warm."

She said if people were rewarded for saving energy, they would be more likely to invest in measures like hot-water cylinder wraps and effective insulation.