Source: Utilities Disputes
Utilities Disputes, the independent disputes resolution service, is welcoming today’s decision by the Electricity Authority Te Mana Hiko on improvements to electricity billing, especially the limiting of back bills.
The change to back bills, which Utilities Disputes has been advocating for, will ensure there is greater consistency amongst electricity retailers, and will bring New Zealand into line with international best practice.
“This is a significant reform and fixes a big gap in consumer protection,” said Utilities Disputes Commissioner Neil Mallon.
“Back bills, sometimes covering years of accumulated charges, can cause enormous financial shock and distress for households and businesses alike. It shouldn’t be up to retailers to decide how far back to go.”
The Electricity Authority will limit retailers going back more than six months. A retailer charges back bills or catch-up bills when there have been faults in meter readings and other issues, which are generally not the fault of the customer. Often bills are large dating back to a year, even longer, before the fault has been detected.
“Today’s decision is welcome as it sets a clear, fair limit and gives consumers and retailers much greater certainty.
“We also submitted for retailers to have standardised billing information so consumers can easily find the info they need and welcome that as part of these changes which will be in place by 30 October 2026”.
Utilities Disputes is the free and independent resolution service for electricity, gas, telecommunications, and water complaints.
In the past year, Utilities Disputes considered 183 deadlocked complaints about back bills, making up 12 percent of all deadlocked energy complaints, those where the retailer and consumer have not been able to agree on a solution. The average value of all back bills complained about was $5,130, with residential back bills averaging $2,290 and commercial back bills averaging $18,280. Twenty percent of complaints involved back bills covering more than 14 months of usage, with the average value in that category reaching $9,760.
Utilities Disputes data shows a significant inconsistency in how retailers have approached back-billing, with some going back 14 months, others much longer, and in one case as far as 72 months. Consumers are often unaware that their bills have been based on estimates, leaving them blindsided when a large catch-up bill arrives. In some cases, retailers have then attempted to direct debit the entire amount in a single transaction.
“We have seen cases where businesses have been hit with back bills of $75,000 or more with the retailer attempting to debit the full amount from a customer’s account in one go without any warning or discussion. That is simply not acceptable. The consumer has little to no control over the errors that cause these bills, so it is right that the law now sets a clear limit on how far back retailers can go,” Neil Mallon said.
The reform will also create a more level playing field across the industry. Some retailers had already voluntarily limited their back-billing timeframes in response to the concerns of Utilities. Putting this into the Electricity Industry Participation Code means all retailers are held to the same standard.
New Zealand has lagged comparable markets on this issue. Victoria limits back-billing to four months, New South Wales to nine months, and the United Kingdom to 12 months.
“Six months is a significant reduction, but it can still mean a substantial bill for some customers. We encourage retailers to work proactively with them well before a back bill is issued, and to offer flexible payment plans where large amounts are involved. The goal here is ensuring customers are treated fairly throughout the process,” Neil Mallon said.
