NZ second for power switching
New Zealand has one of the most competitive electricity markets in the world, ranking second last year in the number of people switching power companies.
That's according to the VaasaETT World Energy Retail Market Rankings report, which found that while Australia's Queensland region retained the number one spot, New Zealand was the fastest gainer among the 38 electricity markets tracked, having climbed from 5th in 2009.
The report said the gains were due to the Government's recent "What's My Number" campaign as well as a more active electricity hedge market, which allows power providers to smooth out price volatility and offer end users more competitive pricing.
The report said the rate at which electricity users have been switching power companies has been rising since 2008, when 10.5 per cent of the market changed providers, to 19.5 per cent last year.
That equates to 388,000 people making the switch in 2011, collectively saving about $8.7 million.
Early indicators show 183,138 people switched in the first six months of this year, but Electricity Authority chief executive Carl Hansen said the slow down in pace doesn't necessarily mean competition is slowing.
"From our perspective switching rates are part of a more complex equation," he said. "What we may in fact find in the future is that lower switching rates may also indicate a highly competitive market as it may show that retailers are being driven to offer very similar prices, removing the incentive for consumers to switch."
VaasaETT is a global energy think-tank based in Finland, and its annual utility customer switching research project is the one of its kind to track customer switching in 38 competitive retail electricity markets.