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Electric Kiwi seeks action on Meridian

NZ NewswireNZ Newswire 20/06/2016 Pattrick Smellie

Fledgling electricity retailer Electric Kiwi is seeking disciplinary action against Meridian Energy after price spikes in the wholesale electricity market.

It has complained after prices from the country's largest power generator got as high as $4,000 per Megawatt hour on June 16.

But Flick Electric, another minnow retailer, is not taking any action and says it's "pretty comfortable" both with the way the wholesale electricity market worked that day and the tools it gives customers to manage such price spikes.

For its part, Meridian Energy is waiting to hear whether the electricity regulator will agree to conduct an undesirable trading situation inquiry.

The Electricity Authority says it is in the very early stages of gathering and processing information on the complaint.

Electric Kiwi director Phil Anderson told BusinessDesk it believed Meridian had deliberately manipulated wholesale electricity prices.

Meridian chief executive Mark Binns said the price spikes resulted from a perfect storm of circumstances on a day when temperatures plunged around the nation while a still day in the North Island that prevented wind farms from generating much power.

Electric Kiwi's customers are charged for power on a flat rate basis, unlike Flick's, who are charged according to the prevailing wholesale electricity spot price. That leaves Flick customers exposed to spikes in power prices caused by unusual circumstances in the national electricity system.

"We think they manipulated prices," Mr Anderson said. "There was a genuine shortage in the North Island but they caused an artificial shortage in the South Island."

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