Time to undo the harm

We want action on the electricity overcharge; older people's health is at stake.

Archive item only - last updated December 2009

Age Concern New Zealand's national President Liz Baxendine asked Energy Minister Gerry Brownlee for action on energy poverty. 

"It's time to use a portion of the windfall profits earned by state-owned energy companies to undo some of the harm that's been done," Liz Baxendine says. 

Domestic consumers have faced excessive electricity charges through manipulation of the wholesale electricity market, mostly by state-owned enterprises.

Age Concern has daily contact with older people throughout the country. Too many are frightened to use heating but need warmth to maintain their health. Often the costs are passed on to the health system as older people need hospital treatment for respiratory and other winter-related illnesses. 

Energy poverty is a reality in New Zealand, especially for people on low or fixed incomes, living in older uninsulated houses, and with high energy needs. 

Given there is little prospect of repayment of the $4.3 billion overcharge of consumers over the past six years calculated by the Commerce Commission, we're seeking action to protect vulnerable consumers."

Age Concern wants Government to undertake a full investigation of electricity retail costs and prices.  

Undo the harm

In addition, Age Concern is calling on Gerry Brownlee to establish a new fund funded from SOE surpluses to undo some of the harm. This should be achieved by:

• Requiring that electricity SOEs make an annual contribution of part of their surpluses (e.g. two percent) to the home insulation fund.  This initiative will boost the economy and assist low-income and vulnerable people to have healthier, more sustainable homes. 

• Urgently putting in place a programme of emergency payments and rebates to relieve energy poverty this winter for low income and vulnerable people.

"We consider these two measures will significantly help older people and look forward to the Minister's positive response," Liz Baxendine says.

Energy poverty

This is defined as households having to use more than 10 percent of their income to maintain healthy temperatures. They are forced to cut back on essential household services such as heating, lighting, cooking, and hot water.

The concept of energy poverty is used widely in the UK to identify and alleviate hardship. If households there are using more than 10 percent of their income to maintain the minimum safe temperatures set by the World Health Organisation, additional government assistance swings into action.

Energy consultants say New Zealand is lagging behind. For example, the UK government spends around eight times per capita more than the NZ government retro-fitting insulation and putting efficient heating appliances into cold homes.

Comment

We want to see energy poverty eliminated through a combination of crisis payments to the most vulnerable home energy consumers, fairer electricity and gas tariffs, and a long-term programme of home energy retrofits.

Resources

> VISIT the Domestic Energy Users' Network's campaign website

> READ the Domestic Energy Users' Network's briefing for the incoming government [PDF file, 0.01MB]

> READ  Fuel Poverty in New Zealand –Ministry of Social Development 

> VISIT  Consumer: For further information on Heating Choices 

> VISIT  Consumer PowerSwitch: Compare power suppliers' prices quickly and easily with this consumer online service

> VISIT  Energy Efficiency and Conservation Authority (EECA): a Crown entity. Its Energy Wise Home Grants provide financial help for improving insulation in pre-1997 houses occupied by people on low incomes. 

> CONTACT  Charitable trusts: Your local community energy saving trust is active in providing investments in local energy efficiency.

Domestic Energy Users’ Network

DEUN is a network of national organisations which advocates for affordable and sustainable energy services for all householders. Our policies are based on both statistical evidence and the experiences of our organisations. We promote actions that reduce the inequities in well-being, made worse by household energy bills. We promote energy efficiency and renewable energy solutions that improve household living conditions while reducing greenhouse emissions and other adverse environmental impacts.

Our members are:
• Age Concern New Zealand; 
• Grey Power Federation;
• Royal New Zealand Returned and Services Association;
• Rural Women New Zealand;
• Public Health Association;
• Child Poverty Action Group.

Photo (detail) used by courtesy of Motumboe