Consumer protections in the electricity sector

Background

Earlier in 2023, we commissioned Allen & Clarke to undertake some research for us, as part of our ongoing monitoring of how the findings from the Electricity Price Review (EPR) are being implemented. We asked them to assess:

• how the key recommendations from the EPR had been implemented so far, and
• what impact they were having on NZ’s small electricity consumers.

Their report to us in July 2023 highlighted that there is still work to be done, particularly in areas where the most vulnerable consumers are affected. They noted that the EPR’s recommendation to introduce mandatory minimum standards to protect vulnerable and medically dependent consumers had not been implemented.

Implementing the Electricity Price Review recommendations

The Consumer Care Guidelines

To date, the Electricity Authority (the Authority) has only developed voluntary Consumer Care Guidelines, not mandatory ones. In deciding to make the guidelines voluntary, the Authority stated it was confident retailers would continue to do the 'right thing by their most vulnerable consumers'. 

However, in June this year the Authority published a summary of their first annual review of electricity retailers' alignment with the voluntary Consumer Care Guidelines, showing that only 9 of the 38 retailers they surveyed were even partially aligned with them. They expressed concern that the guidelines retailers were least compliant with were those designed to protect vulnerable or medically dependent consumers.

We would like to see the Consumer Care Guidelines become mandatory, to make sure all electricity retailers are legally obliged to comply with them. Ensuring we have robust and consistently-applied consumer protections in Aotearoa is essential, as they:

• safeguard consumers from unfair practices
• ensure equitable access to electricity
• address affordability concerns, and
• help maintain a high standard of service.

Assessing the current protections

As a next step in our research, we asked Allen & Clarke to assess the current consumer protections, and identify gaps and opportunities to improve these protections for residential and small business consumers.

The findings from this report will help inform our ongoing work to advocate on behalf of NZ's small electricity consumers. We will also continue to call for the Electricity Authority to make the Consumer Care Guidelines mandatory.