NEW ZEALAND BUSINESS NEWS
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The Electricity Authority, the Crown entity that regulates New Zealand’s electricity industry, has set out the cost of its free power plan comparison and switching service, Billy, and explained why it built its own site rather than continuing to part-fund Powerswitch.
In a response under the Official Information Act 1982 released on 18 September, the Authority said promoting competition in the electricity market is a statutory objective, and promoting the benefits of comparing and switching retailers is a statutory function. It said the decision to build Billy reflected a choice to invest in a publicly owned platform that is transparent and able to evolve with the market, rather than continuing to partially fund a third-party service.
The Authority said this approach gives New Zealanders a long-term comparison tool that is independent of commercial interests, data-driven, and designed to support future improvements in electricity data and consumer information.
The Authority disclosed what it paid to operate Powerswitch each financial year from 2019/20 until the funding arrangement ended, excluding GST. The payments were $119,214 in 19/20, $1,194,101 in 20/21, $1,200,000 in 21/22, $1,200,000 in 22/23, $1,395,989 in 23/24, $1,451,828 in 24/25, and $744,062 in 25/26.
It said the final figure was lower than previous years because it covered a half-year contract extension. The Authority also cautioned that these amounts are not directly comparable with the Billy figures, because Billy is fully funded by levy payers through the Authority and receives no commission, whereas Powerswitch was only partially funded by levy payers and drew additional revenue from third parties and commissions.
The original whole-of-life cost to develop and operate Billy over 44 months was $6.141 million, which was lifted to $6.7 million. The Authority attributed a 3% budget overspend to a small delay to launch, and said it approved an additional 6% to increase data security measures in response to an increasingly complex security environment. It described the overall 9% increase as in step with an increase in the initial project scope, particularly in strengthening data security and ensuring full market representation, rather than a like-for-like cost increase.
The actual cost to date of developing, establishing, and launching Billy was $2.6 million, and the cost of procuring it was $595,000. The operating budget is $4.1 million over the 44-month contract term, averaging $1.1 million per year, with higher costs in the first two years as the service launches and embeds, and lower than average in the last two as it matures. Ongoing operation is likely to require 1.5 full-time equivalent Authority staff, a figure that may change with the level of market change and support required. Separate existing Authority funding has been allocated to consumer awareness and engagement.
In a statement marking six months since launch, the Authority said about half a million people have visited the site, more than 200,000 comparisons have been made, and more than 8,500 people have initiated a switch through Billy. It said its latest figures show average potential savings of $62 per month for those switching through Billy.
Zoe Priestley, the Authority’s General Manager, People, Communications and Engagement, said the response had exceeded expectations. “What we’re most proud of isn’t the numbers themselves. It’s what they represent,” she said. “Every comparison checked is someone taking control. Every switch is someone feeling empowered to ask whether their current plan is the best deal for their household.”
The Authority said Billy draws on information from 27,000 New Zealand households and compares plans covering around 97% of Kiwi homes. It also notes on the site that it relies on information supplied by power companies and cannot guarantee that the information is accurate or up to date.
The Authority’s own research found that 38% of households and 35% of small businesses were not confident they could afford their power bills over the following six months. That figure sits behind its argument that clear comparison tools matter, and it is the group Billy is intended to reach alongside households.
The Authority said it has introduced stronger consumer protections over the past 18 months, including safeguards for people who rely on electricity for critical medical equipment, and has opened up more choice through time-of-use plans that can reward households for shifting when they use power. It said it is requiring bills to be clearer and easier to understand, and placing more responsibility on power companies to ensure customers are on the best plan for their circumstances.
Priestley framed the service as part of a wider effort rather than an end in itself. “Our goal has never been simply to build a comparison website. Our goal is to help promote a competitive electricity system that works for people,” she said.
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