We do things a little differently from other electricity retailers when it comes to your power – we’re all about keeping it fair, upfront and honest – and your home generation is no different. So, being the open book that we are, let’s run through some of the ins and outs of Home Generation with Flick.
What’s Flick’s buy-back rate?
Our Home Generation customers have access to wholesale power prices (also known as spot prices) for their buy-back rate. This means that the price of your exported electricity fluctuates in direct relation to the wholesale electricity market, with prices changing every 30 minutes depending on supply and demand.
Why does Flick offer a wholesale buy-back rate and not a fixed rate?
As some of our early customers will remember, we set out to disrupt NZ’s electricity industry back in 2014 by offering Kiwis access to the wholesale market. Our wholesale pricing plan was the only plan we offered for around four years, and our customers saved lots on their power bills because spot prices were so low. Naturally, when we created our Home Generation plan back in early 2017, it offered wholesale buy-back rates too.
Since then, the market’s become a lot more volatile, and prices aren’t nearly as stable as they once were. While that’s meant we’ve had to press pause on Wholesale as a pricing plan, for those of you on Home Generation, it can mean you’ll see a mix of sweet opportunities to access soaring buy-back rates (case in point: 2021’s high wholesale prices!) as well as times when spot prices drop.
Here at Flick, we don’t make any margin from your buy-back rates; they’re set at the wholesale price, so you’re receiving the same prices that generators are, based on supply and demand at any given time. It’s a fair way to price, but more importantly, it means that we’re all contributing towards providing Kiwis with a reliable, secure electricity supply. How so? When you’re on our Home Generation plan, you’re working with the market, adjusting the times you export power based on the price signals of your buy-back rates and when the market needs it (AKA supply and demand). And that’s exactly what we need Kiwis to do!
Will Flick ever offer a fixed price buy-back rate?
It’s part of our mid-term plan to improve Home Generation for our Flick whānau, and that will include looking at whether we can offer a fixed price buy-back rate. So keep your feedback coming – it’ll play a big role in helping us to evolve and improve Home Generation so that it does what you want and need it to do.
Why are my power prices higher than Flick’s buy-back rate?
When we sell you power, the price we charge includes the costs of generation, metering, transmission and distribution, the Electricity Authority Levy and our Flick fee for acting as your retailer. Aside from our Flick fee, all other fees are charges we take on behalf of the other businesses involved in getting electricity to your door (like your lines company or the EA).
When you sell us your surplus generation, you’re usually selling it back to us without any of these additional fees. It’s simply the wholesale generation price.
A point to note – there are a few networks that do include a small network charge for exporting your power back to the grid (currently that’s Counties Power, Marlborough Lines, Nelson Electricity, NorthPower, Top Energy and Waipa Networks). You’ll see this listed as exported generation charge on your Flick bill, and it’s a fee we take on behalf of the lines companies and pass on to them.
Where can I see what the current wholesale price is?
While the wholesale price information isn’t yet available on your dashboard or app, it’ll be something we consider when we’re planning improvements to Home Generation – we know how helpful this would be when you’re deciding when whether to sell or use your power!
In the meantime, the next best option is the WITS website (WITS stands for Wholesale Information Trading System). This site is run by NZX and contains all the real-time information on wholesale electricity prices. It’s a free-to-air site available to the general public.
How do I use WITS?
Good question! It can be a little tricky to navigate if you’re new to it. First up, it’ll help if know your closest Grid Exit Point or Point Of Connection (GXP or POC) – if you’re unsure on what this is, get in touch and we’ll help. Then, have a read of our WITS 101 blog here!
What influences wholesale prices?
Lots of things! NZ has lots of renewable generation so weather plays a big role. If there’s lots of wind and rain in the right places, wholesale prices will tend to drop, and conversely, if they’re in short supply, spot prices will increase. Seasonal demand has an influence too (for example, collectively we use more power in the winter than we do in the warmer months), and the availability and current prices of thermal generation, like gas and coal, has an impact as well.
What are forecast prices looking like on the wholesale market?
The graph below gives you an indication of how average spot prices are forecast to move, based on the current available information, until March next year. This data comes from Energylink.
Why isn’t the Wholesale pricing plan available to Home Generation customers when wholesale prices are often low?
Spot prices do drop, but just as often they drive upwards, and occasionally even spike (a price spike is when the spot price briefly rises above 30c per kWh, usually for one to two 30-minute trading periods). Between 19 April and 16 May 2023, for example, average daily prices have ranged from 0.2 c/kWh (yes, really!) to 25.1 c/kWh.
That market volatility was the reason we decided to press pause on Wholesale in 2021, and that volatility continues to be seen in spot prices to this day. We still believe it wouldn’t be right for us to offer a pricing plan to our customers that, at times, will see some extremely high power prices and, in turn, some painfully high power bills (especially when living costs are already so high).
That being said, it is a plan that’s well suited to Home Generation customers who’re engaged with their power use and the electricity market, and who understand the daily, yearly and seasonal fluctuations of spot pricing. If you’d like to chat with us about our Wholesale pricing plan, hit the ‘Contact Us’ button below.
We hope that’s answered all of your Home Generation questions – and if not, don’t hesitate to get in touch. We’re here to help!