Monday, March 10, 2014
Mike Butler: Is prepaid power more expensive?
A claim from Labour’s Energy spokesperson David Shearer that power companies are unfairly targeting the poorest New Zealanders by charging them the highest electricity rates turns out to be untrue. Shearer wrote: "New figures obtained by Labour show those on pre-pay electricity plans - paying electricity bills in advance - pay up to 60 per cent more than those paying a regular power bill".
Therefore today, property owners throughout New Zealand would have fielded calls from distraught tenants demanding that the pre-power meter should be removed.
However, a phonecall to prepaid meter supplier Contact Energy revealed that not only was the claim that prepaid electricity was up to 60 percent more expensive than a monthly account not true, prepaid electricity was slightly cheaper.
Prepower in Hastings from Contact costs 30.989c/kw. There are no other charges. Twenty dollars will buy 64 units.
Monthly account electricity from Contact costs 21.579c/kw plus an electricity commission levy of 0.146c/kw plus a daily charge of $1.76.
A total of $140 would buy 448 units -- which would cost $152.49 on a monthly account.
The cost of removing a prepower meter is $150, and the cost of reinstallation is $150.
This means anyone panicked by Shearer's claims may spend good money to have a meter removed and end up spending more on electricity. Moreover, at the end of the tenancy the property owner would probably require that the meter be reinstalled.
It appears Shearer did his calculation without taking into consideration the daily lines charge that is included in a monthly power bill.
at 3:13 PM