Family left out in cold after ditching provider

Tamara Smith with son Jaxon and cat Whitey in her South Dunedin home yesterday. Photo by Peter...
Tamara Smith with son Jaxon and cat Whitey in her South Dunedin home yesterday. Photo by Peter McIntosh.

A South Dunedin family is warning low-income earners about their power struggle after switching to pre-paid electricity supplier Globug.

Labourer Matthew Lane said he had paid a monthly Mercury Energy power bill for about seven years.

The cost for himself, partner Tamara Smith and their 7-month-old baby Jaxon in their St Kilda home was usually between $120 and $150 a month.

The one-income family switched power companies last month after being lured by a promise of cheaper pre-paid electricity from Globug.

''Paying the power bill wasn't a problem. I joined Globug because it was a deal that sounded too good to be true.''

Matthew Lane
Matthew Lane
Globug and Mercury are both owned by Mighty River Power.

When the family received the pre-pay device, they bought $50 of power and the device glowed green.

''But within three days of topping it up, it had gone amber,'' Mr Lane said.

The device glowed amber to warn the power would be disconnected at noon the next day.

If the device glowed red, the power would be disconnected at noon the same day.

The family topped up another $50, but three days later it glowed amber again.

The family used power to run a small heatpump, a fridge/freezer, a washing machine and a television.

To save power, the family showered every second day, did not use their bath and did not understand why the prepaid electricity was used so quickly.

The family did not have $20 for the minimum top-up payment, the device glowed red and the power was disconnected.

''I'm putting a warning out there for low-income families. A lot of people can't pull $20 out of their back pocket,'' Mr Lane said.

Globug declined a request by the family to top up $10 for some heating.

The family asked to disconnect from Globug and be switched back to Mercury.

However, after disconnecting, Mercury declined to reconnect the family, saying it did not meet its credit criteria.

Mr Lane said he had a clean credit record but had a black mark with Mercury for disconnecting from Globug.

The family called Genesis Energy on June 2 asking to be connected and were told they passed the credit check but it would be June 10 before they could receive power, as the company had a stand-down period with Globug.

The family was left in limbo with a 7-month-old baby and a cold house, as heavy rain fell outside, the family still without power and the money to top up.

The next day, the house was flooded. Friends housed the family until Genesis could connect the power and the stormwater drained away.

Mighty River Power general manager customer James Munro said he could not comment on customers' accounts due to privacy law. However, Globug was the second-cheapest power provider for low-energy users in Dunedin, when comparing power companies on Powerswitch.

''There is less than $10 separating Globug with the cheapest provider.''

The family could have been using more power when the weather became colder after the switch, he said.

Globug prices per unit of power would be cheaper than what Mr Lane paid with Mercury and Genesis, Mr Munro said.

Mr Lane could not be switched back to Mercury because he failed a credit check.

''One of the great advantages of Globug is there are no credit checks,'' Mr Munro said.

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