Kerre Woodham: Access to electricity is a basic human right

If you woke up this morning and you turned on the heater because it was a bit chilly, not as chilly as it has been, but a bit chilly, good for you. Did you think about the cost? If you didn’t, lucky you.

An estimated 40,000 New Zealand households had their power cut due to unpaid bills in 2023, which is a phenomenal number of households. One in five had trouble paying their monthly power bill and this is at a time when the “big four” power companies are earning more than $7 million every day while some households struggle to heat their homes. 

These figures are according to Consumer NZ. According to their financial reports, Meridian, Contact, Genesis and Mercury had combined earnings of $2.7 billion over the last year – about $7.4m a day.  But while the consumer watchdog says the numbers are a bad look for the generation and retail power companies (retailers), the industry says it is ploughing earnings back into developments to help New Zealand transition to a carbon-zero economy.  

So, they’re not all just bloated fat cats puffing on cigars with the profits, and those aren't the profits, those are just the earnings, they are putting any profits back into transitioning to a carbon zero economy, so the wind farms and the like. 

Consumer NZ chief executive Jon Duffy said 60% of New Zealanders were concerned about the cost of energy and “the optics of huge profits at the height of a cost-of-living crisis aren’t great.” It’s the same problem with the banks, they’re making profits while people are struggling to pay the rent and to pay the mortgage. 

The coalition government, mindful of this. has continued the Winter Energy Payment introduced by the Labour Government to help with the cost of heating homes during winter but Auckland law professor Jodi Gardiner says that doesn't cover nearly enough households who are around the edges of poverty. 

If you’re not getting the Winter Energy payment, it’s because you don’t qualify. It arrives in your bank account automatically from the first of May through to the end of September, and if you’re entitled to it, you’ll be receiving it. Jodie Gardner says not nearly enough families are being taken into account for that Winter energy payment, and besides, it doesn’t go far enough. 

Many New Zealand houses, particularly social housing, were built during the era of cheaper electricity and were reliant for warmth on electric heating rather than insulation. Now, that’s changed with the Healthy Homes legislation being passed, but again, Kainga Ora and the statehouse providers were given longer to ensure their homes meet Healthy Home standards than private landlords. So, there are still people living in poorly insulated homes, drafty homes, who are reliant on electricity for their warmth and their cooking, and for everything else. 

It is estimated that now 25% of these occupants nationwide and more than 40% in the South suffer energy poverty, contributing to avoidable hospitalisation. So, you have a choice if you’re on limited income, either a benefit, or the super, or wages that cannot be raised, you either pay the power bill or you buy food, or you know, you have to make those sorts of crunch decisions. 

Jodie Gardner says a return to state ownership of electricity isn't realistic right here right now, she argues a simpler – and more appropriately targeted – approach is to implement “social tariffs” for electricity.   

These are targeted discount energy deals funded by the government for qualifying low-income consumers. There are examples of social tariffs being used overseas to reduce the harm being caused by profit-driven companies operating in essential sectors.    

She says in the UK some private telecommunications providers have voluntarily chosen to bring in subsidise