Natural Gas Suppliers Compared

Mercury turns up the heat in gas supplier ratings

There’s a lot of information out there about finding a good deal on electricity, but what about natural gas? Piped natural gas, sometimes referred to as town gas, is an incredibly effective and affordable solution for all of your cooking, heating and hot water needs, but it can be difficult to navigate the market when you’re looking for a supplier. After all, not all households have access to natural gas and there are relatively few suppliers to choose from compared to electricity. So how do you find a good deal on gas? Well, you could start by seeing what other Kiwis think about their gas company with Canstar Blue’s review and ratings. We’ve surveyed hundreds of paying customers to get their views, so you can make a better-informed decision about which gas supplier is the best fit for your home.

This year, we asked nearly 500 customers to rate their experience with their gas company, and tell us what they consider is important when comparing providers. The results show that bill clarity is the biggest driver of overall satisfaction, along with value for money and customer service. So, which supplier came out on top? Mercury Energy.

•         In addition to achieving five stars in overall satisfaction, Mercury managed five stars across all other variables, which is a feat that few other energy companies have ever managed.
•         Contact Energy, Genesis Energy and Nova Energy performed reasonably well with four stars for overall satisfaction.
•         Trustpower received three stars for overall satisfaction.

According to our research, 71% of gas customers have both electricity and gas with the same provider. This may be because some gas companies require you to have an electricity account in order to access their gas service, however it begs the question: does loyalty pay? Maybe not. Chances are you will need to regularly shop around to find the best deal on gas. Yet alarmingly, only 27% of respondents to our survey said they have compared natural gas companies online. If you’re one of the 73% of customers that haven’t compared, then this page will walk you through everything that you need to know about natural gas in New Zealand so you can make an informed decision about which supplier you choose.

Natural Gas vs LPG

Natural gas and liquefied petroleum gas (LPG) can often be confused with one another. While they are used for similar purposes, there are some critical differences between the two. LPG is delivered in canisters or tanks and customers must order a refill or replacement tank every now and again. Natural gas or ‘piped gas’ however, is delivered straight to your home or business via a large distribution network of pipelines.

Natural gas services operate similarly to electricity, whereby customers have on-demand access to gas and they simply pay for whatever they’ve used at the end of the billing period. Piped natural gas is only available on the North Island however, and even then, not all households have access to the pipeline.

Provided that you’re reasonably close to the gas network, you may be able to organise a mains gas connection, however this can be quite expensive, and it may simply be more affordable to buy LPG instead. If you live on the South Island, LPG is likely your only option.

There are also some physical differences between LPG and natural gas. Natural gas is comprised mostly of methane, whereas LPG is predominantly butane and propane, which burns hotter and cleaner than natural gas. This means that LPG is the gas of choice for many restaurants, cafes and other businesses.

As for what’s cheaper, well that really depends on the market at the time. Generally speaking, natural gas usage rates are lower than LPG rates, however natural gas customers must be mindful of the fact that they are required to pay a ‘daily charge’ for access to the gas network.

Understanding your gas bill

Like electricity, natural gas customers are charged both a ‘variable charge’ for the gas they use, as well as a ‘daily charge’ which covers the cost of supplying the gas to your property. There is only one type of variable rate charge for natural gas, unlike electricity which has two types – the standard plan and low-user plan. A typical natural gas variable rate is between 5 and 10 cents per kWh, while daily charges are about $1 per day.

Your gas provider will check the usage measured by your gas meter every month or quarter, depending on the billing cycle. Usage is recorded in megajoules (MJ) and converted into kilowatt-hours (kWh) for billing purposes. The variable charge component of your bill is calculated by multiplying the variable rate with the energy consumed in kWh. The daily charge component is calculated by multiplying the daily charge by the number of days in the billing period. Finally, adjustments are made to the final price to factor in GST, additional charges and any discounts that you’re eligible to receive.

Gas Discounts

Natural Gas retailers like to reward customers who make their life easier with generous discounts that can help reduce the overall cost of your bill. There are four types of discount you might come across:

• Prompt payment discount: This is a discount of around 10% to 25% for customers who pay their gas bills in full and on time.
• Direct debit: While less common, some NZ gas retailers offer a small discount of about 2% to customers who pay their bills via direct debit.
• Email correspondence: A small discount of about 1% to 2% may be offered to customers who receive their bills and correspondence via email.
• Dual fuel discount: Energy providers that supply both electricity and gas sometimes award customers with a bonus discount when they sign up both services.

List of Natural Gas Companies in New Zealand

There are 10 natural gas companies delivering residential services to North Island residents. These are:

•         Contact Energy
•         Energy Online
•         Genesis Energy
•         Greymouth Gas
•         Mercury Energy
•         Nova Energy
•         OnGas
•         Pulse Energy
•         Switch Utilities
•         Trust Power

Remember that some gas companies require you to sign up for electricity as well in order to access their natural gas service.

Natural Gas Providers Compared

Five of New Zealand’s largest gas providers have received the minimum sample to be included in our 2018 customer satisfaction ratings. In order to be considered in this year’s ratings, a gas retailer must have received a minimum of 30 survey responses. This year’s ratings include Mercury, Contact Energy, Genesis Energy, Nova Energy and Trustpower. Here is a little more information about them:

Mercury Energy

Mercury Energy is an environmentally-focussed energy retailer that offers a range of electricity, solar and piped gas services. Gas customers receive a 10% Prompt Payment Discount, as well as a bonus 2% off for receiving their bills by email and paying with direct debit. Further, customers that sign up for both electricity and gas with Mercury get a bonus ‘dual fuel’ discount of 15 cents per day. Mercury customers can also score a few bonuses, including access to live gas and electricity usage tracking, and the ability to earn Airpoints simply by paying their bills.

Contact Energy

Contact Energy is one of New Zealand’s largest integrated utility companies, offering electricity, gas and even internet services. In order to access Contact’s piped gas service, you will also need to sign up with electricity. Contact plans usually have competitive discounts between 20 and 25 per cent, however the retailer’s biggest selling point is its rewards. Customers that sign up to the Fuel Rewards Program could get 15 cents off per litre of fuel once every month with AA Smartfuel. Some contact products also have generous joining credits up to $250.

Genesis Energy

Genesis Energy has three competitive natural gas products. The first offers $100 bill credit and a 10% prompt payment discount on a two-year contract, the second offers $50 bill credit and a 10% prompt payment discount on a 12-month contract, and the third has a 10% discount on a no fixed-term plan with no bonus signup credit. Genesis Energy is also the only energy retailer where customers can earn FlyBuys points for paying their energy bill.

Nova Energy

Nova Energy describes itself as ‘refreshingly different’, with some interesting offers and local attitude to how it does business. Nova Energy has two natural gas deals: the Home Advantage Plan and the Home Freedom Plan. The first deal is unique in that it promises customers that their rates will be unchanged until 31 March 2020. It also comes with a $150 signup credit. Be mindful that breakup fees apply. The Home Freedom Plan however is a flexible, no-frills attached deal with no discounts or contract terms.

Trustpower

Trustpower is a leading bundled utility provider, offering a range of electricity, gas and internet services. You must have electricity with TrustPower in order to sign up to natural gas as well. Customers receive a 15% Prompt Payment Discount off usage charges, plus 25 cents off per day. Electricity and gas prices are capped until at least one year from the sign-up date.

Gas Distributors in New Zealand

Gas distributors are responsible for maintaining the infrastructure that transports gas from processing plants to your home. There are various gas distribution companies which combine to form the pipeline network. These are:

•         Firstgas
•         Gasnet
•         Nova Energy
•         Powerco
•         Vector

A large portion of what you pay for natural gas is attributable to distributor costs, meaning the price you pay will vary across different distribution networks. Perhaps factor in the potential price of gas if you’re considering moving to an area that straddles multiple networks.

How to get the best deal on gas

Natural gas receives much less attention than electricity since many Kiwis don’t have access to it. Yet, while there aren’t as many providers to choose from, there are still plenty of unique offers for you to compare. What we have seen in this review is that different retailers have different attitudes toward gas deals – while one gas company might boast competitive rates, another offers better rewards and signup incentives. It’s all about understanding your own needs and finding a deal that reflects what’s important to you. So, stop accepting the status quo and take control of your home’s energy. Good luck!