Dunedin friends – prepare to have your minds blown.
We’re on a mission to arm Dunedin with the knowledge to be a whole lot more savvy about who you buy your electricity from, and how you use it. You’ll probably wonder why nobody has ever shared this information with you before – but you know how we roll, breaking moulds and all. So here we have it. The cold, hard truth.
No… really? Yip! Your electricity retailer buys electricity at a wholesale price, which changes every half hour. This is known as the spot price, and it moves up and down depending on supply and demand. If you’re with a traditional retailer, it’s then on-sold to you as the consumer at a set rate.
And it’s right here that we think consumers should be up with the play. Because if you’re purchasing electricity from your retailer at a set rate, the chances are high that what you’re paying is well above the wholesale price that your electricity retailer buys it for.
Here at Flick Electric, we charge you the spot price of electricity, plus all the other costs associated with getting power to your place, at wholesale without any mark-up. We then charge you a separate fee to be your retailer, so all in all, it’s a fairer and more transparent way to buy power. You can see from the chart below that the spot price of electricity is considered low 48.54 percent of the time – we suggest checking these prices against your own power bill and set rate to see how it compares.
As we mentioned above, supply and demand have a significant influence on the spot price of electricity. There are certain times of the day and year when our power usage jumps upwards – usually, we see those increases in the morning, when everyone is getting ready for work and school, and in the evening when we’re all at home cooking dinner and getting ready for bed. We also tend to see a general increase in power use during the chilly winter months, and especially during particularly cold snaps – important to note when you live in Dunedin!
When the supply of electricity struggles to meet a surge in demand, the spot price of electricity is pushed upwards. But thankfully, as the age-old saying goes, what goes up must come down! So, correspondingly, there are also periods of the day and night (known as off-peak times) when our collective demand drops right down. Generally, these fall from mid-morning until later in the afternoon, as well as overnight. We also use less power during the warmer summer months, when the heaters are off and we’re drying our washing on the line outside. And with the drop in usage comes a welcome drop in the spot price of electricity!
Flick customers make the most of these cheaper times and low spot prices by shifting their jobs to the off-peak hours. It’s as easy as flicking your dishwasher on when you go to bed, rather than straight after dinner, or turning your washing machine on at 6 am (it’ll also be finished in time to hang on the line before you head out the door – bonus!). So it pays to be aware that if you’re with a traditional retailer who’s charging you set rates for your power, while you might be safeguarded from the odd increase in spot prices, you’re also missing out on lots of low, low goodness. Simply by shifting the times that you do a few jobs means you’re paying off-peak prices and saving a bundle, without using less power. And that deserves a big high-five!
That’s right, Dunedin – the wholesale electricity market is your friend! When spot prices are low around the country, they’re usually really low down south. Why? Well, most of NZ’s clean and cheap hydro energy is generated in the South Island. Under usual weather conditions, our southern Flicksters tend to have access to cheaper spot prices because it costs less to transmit power to the folks who are closest to it. The further away you are, the more expensive it gets.
If you’re a Dunedin Flickster, you can expect to see solid long-term savings – over the past year (up until September 2017), our Dunedin customers saved an average $355 compared to what they would have paid with their previous electricity retailer, and that includes a rare Dry Winter period when hydro lakes were low and spot prices were up. Saving on your power bill is all too easy for our #CleverFlickers, especially with our Flick dashboard and CHOICE app which show customers the real-time spot price of power. Then it’s as easy as shifting your usage to times of the day when spot prices are low!
Who’d have thought?! There’s lots of confusing information out there, but here’s the truth: whether you’re with Flick or some large gentailer, all our electricity comes from the same place – the National Grid. Throughout NZ we have lots of generation sites, from hydro stations and wind farms, to geothermal and coal power stations. Every bit of electricity generated by those various sites goes into the National Grid, before being distributed to our homes and businesses.
A number of electricity retailers in NZ own generation sites that flow into the National Grid. So when they talk about 100% renewable energy, they’re talking about the generation side of their business. But it can be misleading to customers, who assume that by joining said retailer, they’re using sustainable, renewable energy all of the time – and that’s simply not the case. The actual electricity that your retailer buys and on-sells to you all flows into, and out of, the National Grid. None of us can pick and choose whether our electricity comes from the clean generators or the dirty ones – unfortunately, that ain’t how it works!
When there’s high demand for electricity (such as during those peak hours of the day and night) our clean forms of generation, like wind and hydro, often can’t produce enough energy to meet demand. NZ’s National Grid is backed up by reserve generators for situations like these, but those reserve generators are all powered by fossil fuels (coal or gas) or diesel, which spew loads of carbon emissions into our air. Effectively, each time we use power during periods of high demand, we’re collectively contributing to an increase in carbon emission levels. It’s interesting to note that this can also happen if the wind drops, or our hydro lake levels are low – which is why we think it’s important we’re all aware of what’s going on within our electricity industry.
If you’re a Flickster though, it’s likely you’ll already know that simply by changing the time of day that you use your appliances, you can help to reduce the strain on our electricity infrastructure and our reliance on those dirty, emission-producing generators. It’s a big sticking point for us here at Flick, and one of the reasons we developed the world first CHOICE app, which shows the live spot price of power, and the live carbon emission levels from the electricity in the national grid. By changing the way we use power, we can have a positive influence on our environment – and every little bit counts.
It’s interesting stuff, huh? We hope this has helped you understand some of the complexities of the electricity industry, and the influences we have on them, both good and bad. There’s so much room to do things better, and we believe it all starts with access to NZ’s wholesale electricity market – go on, Dunedin, you’ll be glad you made the flick!