Vulnerable Electricity Customers Get Raw Deal from Globug

Vulnerable Electricity Customers Getting Raw Deal, Consumer NZ Survey Finds

Consumers getting their electricity from prepay power retailer Globug are more likely to get bad service, Consumer NZ’s latest satisfaction survey has found.

Consumer NZ head of research Jessica Wilson said Globug’s ratings were alarming because the company provides power to some of the most vulnerable consumers.

“Consumers who’ve experienced financial difficulty paying their bills or had their power disconnected may have no other choice than Globug,” Ms Wilson said.

Globug customers must pay for power in advance. They also pay a fee (from 20c to 75c) each time they top up their meter.

Consumer NZ’s survey found 42 percent of Globug customers experienced poor service in the past year, the worst result of any power company. One in four Globug customers said they’d complained to the company about its service.

Many of the company’s customers were also struggling to pay for power.

Just over half had experienced financial difficulty in the past year with one in two borrowing from friends or family to meet power costs. Sixty-four percent had a household income of less than $50,000.

Ms Wilson said Globug’s results stood out from the overall trend, which showed a small rise in customer satisfaction. Across all consumers, 51 percent were very satisfied with their power company’s service, up from 45 percent in 2017.

However, the survey found a significant number of households were having trouble paying their bills.

Eighteen percent of consumers had run into financial difficulties paying for power in the past year.

Fourteen percent had overdue fees added to their account because they couldn’t pay on time while 13 percent had borrowed from family or friends to pay their bills.

Disconnections for non-payment have also started to rise again. Last year, 25,317 people had their power disconnected because of unpaid bills, up from 19,106 in 2015.

“Electricity is a basic consumer right. Everyone should be able to get affordable power and decent service. Our survey has found that’s not the case for many,” Ms Wilson said.

Consumer NZ will be providing the results of its research to the government’s electricity pricing review.

ENDS

Consumer NZ’s survey results are available in the June/July issue of Consumer magazine and online at consumer.org.nz. A nationally representative sample of 1525 New Zealanders, aged 18 years or over, participated in the survey.

Consumer NZ is a non-profit organisation. In addition to our product tests, we investigate consumer issues and campaign to improve consumer rights. But we're not government-funded and don't take advertising, so we rely on revenue generated from membership to fund our work in getting all New Zealanders a fairer deal. Consider supporting us today. Join us, and become a member atconsumer.org.nz.

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