Genesis opens bidding for a South Island customer base

Monday 8th February 2010

Genesis Energy is the latest power company to go for a chunk of the once-lucrative Dunedin retail electricity market, following the announcement of electricity reforms that will give it access to generation capacity in the South Island for the first time.

Genesis will gain ownership of the hydro power stations Tekapo A and B under the reforms, making pursuit of a southern customer base realistic, and offering Genesis a political fillip by being seen to stir up retail competition just as it seemed to be dying after the MRP-led customer switching frenzy of the past 18 months.

Genesis says its electricity price is around $210 per year cheaper than incumbent Dunedin retailer Contact’s tariffs, based on an average household consumption. The tariffs are also frozen till at least February 2011, which puts pressure on Contact’s plans to end its retail price freeze in Dunedin, in October.

Genesis will be making further South Island offers very soon, and can be expected to give not only Contact, but also TrustPower and Meridian, a run for their money in regions which have traditionally supported among the highest profit margins in the country, largely owing to a lack of competition.

Genesis puts the boot into Contact a little further in Dunedin by offering customers using LPG for heating free annual rental of an LPG bottle, worth around $100.

Businesswire.co.nz

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