Loyal power customers out in cold

"If I was an existing customer, I would be quite miffed." Luke Blincoe, chief executive of Electric Kiwi

Kiwi consumers are going cold on power companies who offer great deals to new customers, but not to existing ones.

Power firms are battling it out in an increasingly competitive market and trying to woo new customers with credits and freebies.

But in some cases, that has left customers feeling neglected by the provider they are already with.

Meridian Energy offers a $200 welcome credit to new customers, while Mercury has a $100 credit available. Both have plans that are available only to new sign-ups.

Trustpower gives a Samsung smart TV to those who join for power and fibre or broadband.

Luke Blincoe, chief executive of Electric Kiwi, pointed to a Meridian Economy 24-month fixed-term plan being promoted on Powerswitch and open only to new customers.

It appeared as the cheapest option for many Auckland households looking to switch. He said some existing Meridian customers might not realise that the plan they were on was further down the list, and was more expensive.

There is also a Mercury deal which worked out about $200 a year cheaper for a North Shore, Auckland household of four than a plan that is not limited to new customers.

‘‘If I was an existing customer, I would be quite miffed,’’ Blincoe said. ‘‘In an environment where we are seeing customers receive price-increase letters, it makes it tricky for some people.’’

Blincoe said the power industry was more bullish than others in making it clear that the offers were not for existing customers.

But he said it was a hard sell at a time of increasing profits.

Mercury last month reported a 53 per cent increase in first-half profit. Genesis recorded a 4.2 per cent lift in profit.

There are a number of fixed-term deals being offered, too. But Blincoe said it was worth being wary.

‘‘Customers should question, why is that? Is that an example of a company backing themselves to delight and keep customers on goodwill?

‘‘[Fixed-price plans] offer certainty around price but the ability to respond to poor service is what the customer is giving up.’’

Sue Chetwin, chief executive of Consumer NZ, said it was a difficult issue.

Customers could look to switch provider if they were not happy, provided they were not on a fixed-term contract.

‘‘The other thing they can do is contact their supplier and see if they can’t get the better deal either straight away or when their contract finishes. But utilities companies do have the right to encourage new customers.’’