Wellington, New Zealand --- (METERING.COM) --- August 20, 2013 - During 2012, there were 24,209 additional switches in New Zealand over those recorded prior to the What’s My Number campaign in 2010, with estimated average savings of NZ$175 (US$140) per switch and estimated annual national savings of NZ$4.24 million (US$3.4 million).
This shows that in 2012 the campaign continued to have a positive effect on consumer propensity to switch electricity retailers and in increasing retail competition, according to the Electricity Authority’s latest annual review.
In 2012 – year 2 of What’s My Number – there were 356,881 completed switches in New Zealand. This compares with a total of 388,000 switches in 2011 – including 244,199 completed switches in the 7 months since the campaign was started – which is 8 percent down, with such a drop expected primarily due to the large number of switches at the campaign start.
What’s My Number is the central program of the Consumer Switching Fund (CSF), a $5 million per year contestable fund, over three and a half years (November 1, 2010-April 30, 2014) to promote to consumers the benefits of comparing and switching retailers and to improve the capability of the Consumer Powerswitch website.
The report states that overall, the retail market in 2012 was characterized by sustained high levels of switching, a reduction in the market share of dominant retailers in various regional markets and retailers aggressively chasing customers. A changing pricing environment during 2012, which saw wholesale electricity prices and some regional distribution charges decrease and transmission charges increase, resulted in varying levels of benefit, with retailers in some regions offering lower prices to consumers.
During 2012, retailers also continued to offer discounts or loyalty payments to retain customers who applied to switch to another retailer and make process improvements to deliver greater customer satisfaction. For example, some retailers checked to ensure customers were on the optimal tariff base for their consumption and were refunding any overcharging.
The report also notes that almost 600 businesses switched suppliers in the six months following the introduction on October 1, 2012 of an online tool to allow them to check they are getting the best deal for electricity from participating retailers. Previous research had indicated that barriers to small to medium-sized enterprises (SMEs) switching included perceptions that there weren’t any real gains to be made and it seemed to be too much hassle.
The tool works by enabling business owners to input information about their electricity consumption, which is automatically sent to participating retailers. Retailers then have the opportunity to respond with a bid for the business’s power supply. SMEs receive a list of all offers within 10 business days, from which they can select the best deal for their business. The SME tool reduces both consumers’ and suppliers’ transaction costs of switching.