Record number of new entrant retailers in electricity market

Record number of new entrant retailers in the electricity market

11 February 2015

A record seven new electricity retailers have entered the retail electricity market since January 2014, more than in any previous year.

Electricity Authority Chief Executive Carl Hansen says “this is very positive news as it means consumers have more choices, and can pick a power company that best suits their needs.”

“It also puts more competitive pressure on existing retailers to deliver the services consumers want at sharper prices. If the new retailers are unable to gain significant market share then that is likely to mean existing players are delivering what consumers want. Either way, it is a win-win for consumers.”

The increase in new entrant retailers reflects the Authority’s focus over the last couple of years on reducing barriers to entry for potential retailers. The Authority has adopted initiatives that reduce wholesale market risks for retailers and make it easier for them to manage the remaining risks. The Authority also altered customer switching rules recently so that retailers can be confident they’re competing on a level ‘playing field’.

The seven new retailers bring the total number of retail brands to 27. The new retailers include: SELX; EMH Trade; Ecotricity; Electric Kiwi; Body Corporate Power Ltd; and Giving Energy.

Hansen adds that “while most of these new retailers are still piloting their services and some are not actively pursuing customers, it appears they’ll be offering a diverse range of packages and products—some of which are targeted to specific regions—which is great for consumers who want to shop around for alternative options.”

In 2012 and 2013 only three new retailers entered the retail electricity market each year and in 2011 just two new retailers entered the market.

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