Electricity user says offers rip-off, bribe

Mercury Energy is ''ripping off'' customers and trying to ''bribe'' back disgruntled customers, a Dunedin woman says.

The woman, who wanted to remain anonymous, said Mercury Energy supplied electricity to the small Dunedin business where she works until its two-year contract with the power company was due for renewal.

Mercury Energy emailed her that the contract would automatically renew and the price of electricity would increase so she researched other companies and decided to switch to Contact.

When Mercury Energy became aware of the impending switch it offered her a lower rate and a $200 ''good will'' credit.

The new rate was more expensive than Contact Energy and she declined the offer.

''I'm sick of electricity companies playing games. They should have offered me the better rate in the first place.''

Mercury Energy emailed her again and offered her a $500 credit and the same, lower rate.

The small business had paid its bills promptly and she was insulted Mercury had raised the price and then lowered it and tried to ''bribe'' her with a credit.

Electricity companies were ''ripping off'' customers with inflated electricity prices, she said.

A Mercury Energy spokeswoman said small business customers consumed about five times more electricity than residential customers and were offered larger credits than residential customers.

Offers and discounts are a sign of a highly competitive market at work and ultimately that's good news, that companies are competing vigorously for customers.

Mercury Energy reviewed its rates annually, she said.

Electricity Authority chief executive Carl Hansen said it was increasingly common for power companies to offer discounts and credits to retain customers.

Power companies were not overcharging customers, he said.

''The evidence we have is that the strong competition in the electricity market is forcing retailers to absorb cost increases, rather than pass these fully on to their customers.''

Authority analysis revealed the costs incurred by electricity retailers over the past three years increased 21.5% and the rates charged to customers in the same period increased 12.5%.

''Retailers have absorbed an estimated $190 million of costs since late 2010.''

Customers should shop around, he said.

''Shopping around doesn't always mean switching. Sometimes, it is very valuable to have a chat with your current power company and make sure that you are getting the best deal.''

shawn.mcavinue@odt.co.nz

Smart in name only

It has become obvious to me in my dealling with electricity companies that one does not have to have very much business acumen to run them. I was offered the same deal as this lady from Contact when I notified them I was moving to Mercury. While I paid my bill on time I was taken for granted, but in a vain hope of retaining my custom they offered me $200. The mind boggles to think of the profit they must take if they can offer this and the $10,000 in a competition each month if you paid by credit card. Not just paid your bill on time.

When I had my house rewired last year a smart meter was installed by Delta but they had no record of it a fortnight later and sent a guy round to photograph it after two letters and phone calls to me about me having to install a smart meter soon. It was the 10th one he had photgraphed that week, he said. The smart meter cant be read online by my new supplier though as they are seperate to the company so they still have to send the reader. So the comedy continues at my expense.

I find the whole electricity industry is badly regulated and run regardless of all the red tape. Just more fat cats licking cream.

A business complaining

A business complaining that another business isn't offering a service for the cheapest price possible without a negotiation. I can see why that business is still 'small'.

Advice to 'small business' never accept the price they offer you first.

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