In 2018, the Minister of Energy and Resources commissioned an independent Electricity Pricing Review (the EPR) to investigate New Zealand’s electricity market. At that time, electricity prices for residential consumers had been increasing faster than inflation for many years, putting pressure on household budgets. In comparison, the cost of electricity for commercial and industrial consumers had remained relatively flat.
The results of the EPR were released in 2019. It found that small electricity consumers – like residential and small business customers – were struggling to make their voice heard within the electricity sector. The obstacles they faced included:
- the sector's complexity
- a lack of consumer resources
- cultural differences and language barriers.
To mitigate this, one of the EPR’s recommendations was to establish a Consumer Advocacy Council who would:
- be a trusted, credible, authoritative and independent advocate for residential and small business electricity consumers
- operate independently of electricity industry participants, regulators and Government.
In response, Cabinet agreed to establish the Consumer Advocacy Council (the Council) as a Ministerial Advisory Committee in early 2020. The Council is governed by a board, and supported by a Secretariat who provide administrative and research services.
What we do
Our role is to advocate on behalf of small electricity consumers – particularly households and small businesses – and protect their interests in relation to electricity supply. We represent approximately 2 million residential consumers and 530,000 small businesses across the motu.
Currently, these consumers struggle to make their voices heard and exert influence over decisions affecting them in the electricity sector. This is because:
- the complexity of the sector makes it difficult for them to understand, and express their views about, things that affect their electricity supply and power bills
- they lack the considerable time and resources needed to get involved in decision-making processes, the outcomes of which are largely made on their behalf by electricity sector participants, regulators and the Government
- cultural differences and language barriers often stand in the way.
This results in a power imbalance and lack of capacity to effect positive short-term or systemic change. Our goal is to create positive change for small electricity consumers by:
- collecting information highlighting real issues and concerns for consumers
- raising their concerns with those in the energy sector
- prioritising our efforts to make the biggest impact at both practical and systemic levels
- creating a network of allies in the sector
- removing complexity and mystery from the electricity sector, so consumers can make more informed choices and have more control.
To do this, we:
- commission specialist research and analysis of the issues facing small consumers
- respond to consultations and policy announcements, by making formal submissions and attending select committees on behalf of small consumers
- complement, rather than replace, existing consumer representation on advisory groups and consumer panels
- regularly meet with electricity regulators, other agencies and industry participants.
Who we work with
We work with:
- the Electricity Authority, Commerce Commission, government agencies and industry participants on any electricity matters that are of importance to residential and small business consumers
- consumer groups across New Zealand – in particular, those who advocate on behalf of small businesses and residential consumers, including:
- vulnerable electricity consumers
- the elderly
Both the electricity sector and consumer groups were supportive of the Council’s establishment.
- The electricity sector recognises that more could be done for both their business and residential customers, and have indicated a willingness to collaborate with us for the benefit of these groups. We recognise that giving small consumers an adequate voice will also benefit the sector, by ensuring it better understands the needs of its customers.
- Consumer groups, like Consumer NZ, have repeatedly expressed the view that they find the electricity sector complex and challenging to engage with, and recognise the value of the advocacy work the Council can provide. Our work complements and supports the work they’re already doing on behalf of small consumer groups.
We aim to build strong relationships with the electricity sector and other consumer advocacy groups to help make the industry easier to navigate and fairer for everyone.