This morning the Electricity Price Review released its Options Paper outlining its preliminary views.
On the whole Meridian feels the recommendations are balanced and well-considered.
Meridian Chief Executive Neal Barclay says, “While we’re still reviewing the paper and there will inevitably be things we don’t agree with, we are very pleased with their recommendation to prohibit prompt payment discounts or PPDs.”
“In October last year Meridian made the decision to replace prompt payment discounts with a fairer pricing structure. We believe this change has materially helped those customers who struggle to pay their bills on time as they no longer lose their discount as a result”.
Meridian has been the only major energy retailer to end prompt payment discounts.
Neal Barclay says the decision is about making Meridian’s pricing fairer. The move has cost Meridian $5 million, which will not be recovered elsewhere in customers’ bills.
“If other retailers followed suit, New Zealand consumers could see savings of about $45 million a year. That is a significant amount of money going back into the pockets of those people who struggle to keep their homes warm and dry during the winter months,” says Barclay.
Meridian is also pleased to see the Panel does not favour retail price caps and does not favour prohibiting vertically integrated companies.
“We have always believed that neither of those steps would ultimately provide any benefit to consumers. We are also glad to see that phase out of the low user regulations is favoured,” says Barclay.
Meridian are still reviewing the paper and will engage during the consultation period.
For media queries please contact:
Senior External Communications Specialist
021 174 1715