On a Wholesale Electricity Plan? Be Wary Of Price Hikes This Winter


The Electricity Authority is currently investigating a price spike that hit early in June which was the highest spike in three years. It comes amid concerns that consumers who are on wholesale price-based plans could be in for an pricey winter.

Nigel Brunel, director at commodity firm OMF, said prices between 6pm and 7.30pm were near $4000 per megawatt hour (MWh), compared to an average $52 per MWh in the South Island.

"For a consumer who is on a wholesale price plan and was heating their house and cooking dinner at this time they would have paid an extra $20 for electricity last night," he said.

Companies such as Flick offer consumers power based on wholesale rates. This means they can achieve good savings when power is plentiful but are exposed to price hikes like this. Following the closure of the Otahuhu and Southdown power stations last year there is less supply to meet demand on cold winter days, which makes price spikes like this more likely.