The chief executive of Meridian Energy has opened up on why the company has stopped issuing discounts to customers who pay their energy bills early.
Neal Barclay says the power industry hasn't been fair to New Zealanders, telling NZME it was difficult to admit the lack of fairness in the bill payment system.
Mr Barclay suggested that discounts given to customers who paid their bills early could be seen as penalties for those who could not afford to do the same.
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"That's unfair by any definition," he said.
Meridian Energy is New Zealand's largest power generator and is half owned by the Government.
The company will now wave goodbye to $5 million annually from issuing penalties for late payments, following the Government's review of the energy sector.
The review found that low-income consumers were often missing out on discounts issued to those who paid their bills early. That meant low-income consumers were paying their full power bill while others were getting around 26 percent off.
"Profiting from people's inability to pay a bill on time is something that never sat well with me," Mr Barclay told NZME.
He said the concept of penalising those who make late payments is a "hangover from the days when power companies were regional power boards run by local government".
He said these practices have "no place in a competitive market like retail electricity".
Meridian Energy replaced the "discount" issued to those who made early payments with a credit for all customers, as of October 1.
"Yes, it means we lose $5 million a year in revenue. But that's a small price for knowing you're not punishing those customers that you should really be supporting the most," said Mr Barclay.
The company had been reviewing the system for some time, he added.