20 Jul 2011

Power prices keep on rising

11:59 am on 20 July 2011

An electricity analyst is warning that switching power companies is likely to provide only short-term relief for households hit by rising prices.

Figures from Statistics New Zealand show power prices have increased by 7.8% in the past year.

A spokesperson for the Domestic Energy Users' Network, Molly Melhuish, says shopping around for a better deal provides a temporary benefit.

But she warns that excessive discounting by companies trying to attract consumers will cause pressures that will result in prices rebounding even faster.

Mrs Melhuish says prices will continue to rise for domestic users unless the whole regulatory system is changed so electricity is viewed as an essential service.

A spokesperson for TrustPower says the latest figures have been distorted by a number of factors, including the lifting of price freezes by some companies.