Commerce Commission Takes Action Against Power Companies for Misleading Pricing Tactics

Commerce Commission Challenges Power Companies

The Commerce Commission is taking a stand against two power companies, Contact and Nova, urging them to discontinue their default GST-exclusive pricing for bundled products. This pricing strategy effectively reduces advertised prices by 15%, creating a misleading perception of savings for consumers.

Concerns Raised by the Commission

The commission's action follows a review of guidelines issued in November aimed at enhancing transparency in how bundled services are marketed. Telecommunications Commissioner, Tristan Gilbertson, stated, “This is something we don’t see anywhere else in the retail space and creates the illusion of savings that don’t exist.”

While Contact claims its advertised broadband prices include GST, the commission remains concerned about the confusion created by using both GST-inclusive and GST-exclusive pricing in the same bundle.

Industry Response

Gilbertson expressed satisfaction that many providers, including Mercury, Electric Kiwi, Pulse Energy, and 2degrees, have adjusted their practices to comply with the guidelines. The commission will continue to monitor the situation, offering Contact and Nova a chance to rectify their pricing strategies before considering further action.

With electricity costs on the rise and ongoing concerns about the cost of living, the commission emphasizes the need for clarity in pricing to avoid misleading consumers.

• Commerce Commission challenges Contact and Nova to stop GST-exclusive pricing for bundled services.
• This practice reduces advertised prices by 15%, creating a false sense of savings.
• The commission aims to promote transparency in marketing bundled services.
• Many providers have already complied with the guidelines to avoid confusion.
• Consumers are advised to compare prices carefully, as 15% discrepancies can significantly affect total costs.