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A word on... electricity futures pricing

Spot prices indicate a price for electricity for a particular time and date and this is the actual price your retailer pays for the electricity supplied to you. But there’s another market that indicates future prices for electricity, the forward market, and it plays an important role in how retailers set end user pricing.  

Future dated New Zealand electricity contracts are listed on the Australian Securities Exchange (ASX).  The ASX market is open for any party to trade on, but importantly, this market delivers a daily signal on electricity prices for a period of 3 to 4 years into the future.  This provides an industry wide benchmark for expectations on forward prices, and in simple terms, provides a mechanism by which retailers can provide customers with fixed electricity pricing into the future.

Forward market prices still respond to the same demand and supply factors as the wholesale spot market. However, where spot prices may not respond, for example with the announcement of new generation coming on line in 2 years’ time, the forward market will.  The chart below shows the ASX forward prices for a 2 year period.  It demonstrates that, while the forward price is still closely linked to levels of national hydro storage, other more long term demand and supply factors also drive forward pricing higher or lower.

ASX Forward Prices and National Hydro Storage Comparison

futures pricing

Source: NZX (Spot prices) and ASX (ASX forward prices)

16 Aug 2018
3 minutes to read

1. Mistaking your rubbish for belongings

It may seem like a no-brainer but it happens more than you think. With boxes and trash bags all over your new home, it can be hard to distinguish between what's meant for the bin and what's meant for the bedroom. Make sure you keep very distinct piles or even use different coloured bin bags. This will save you the frustration of realising you threw out that bag with your favourite t-shirts instead of the one with the dirty cleaning rags.

2. Cutting cash corners in the wrong places

There are a lot of different ways to save during your moving process but there are some areas where you definitely don't want to cut corners. Two of the most important are: Your moving company and your packing materials.

A lot of first-time movers try to save cash by finding the cheapest movers on the market. While you should certainly find a company willing to assist with your move at a reasonable price, you shouldn't go with the super saver bargain option and sacrifice quality. Enlisting the assistance of a shady mover can end up costing you thousands down the road. Do your research before picking a company and make sure the customer reviews fare well.

Recycling old boxes for your move can be a great way to save some cash but they must be durable. It's not worth the savings to use beat-up boxes that will fall apart or tarnish your items when you take them out of the moving van. Invest in good boxes - it will save you time and money in the long run.

Investing in sturdy boxes will make you a much happier mover in the long run. 

3. Hiring a moving service without understanding what you're expected to pay

While most movers get estimates, a fair share neglect to get these numbers in writing - which means moving companies can change their original offers. Contact a handful of moving companies and get written estimates on costs. Generally speaking, there are two different kinds of estimates: Binding and nonbinding.

• Binding - With a binding estimate you receive a legal document stating charges and the reasons for them. The pricing can't be changed by the movers unless you ask for significant additional services.
• Nonbinding - With nonbinding estimates the moving company will provide you with more of a ballpark estimate on moving costs based on home size and moving contents.The estimate is provided in writing and the company can only raise the price of their services up to 10 per cent.

4. Not planning for weather surprises

While we all hope for a sunshiny moving day, not everyone's that lucky. Moving takes a lot of planning, so it's highly unlikely that you'll be able to change the date of your big move if it starts to rain. Be prepared and purchase some plastic tarps in case you need to cover your stuff as you carry it into your new home.

You should also look into purchasing a slip-resistant mat if your new front-steps are prone to getting slippery. Old towels can work but when you start carrying delicate objects they do present a tripping hazard. Remember - the more prepared you are for any situation, the better suited you are to make your move as breezy as possible.

5. Bringing the kids along

No, we don't mean you should leave them back at your old house. But you should consider hiring a sitter while you make the big move. It's not easy to balance keeping an eye on your children with organising boxes room by room and beginning the unpacking process. This applies primarily to younger children. If they can't really help with the move, it's best to find someone else to watch them. Trust us - everyone will be much happier this way!

6. Forgetting to turn the lights on

You've unloaded all your belongings, unpacked the essentials for the first night in your new home, the sun starts to set and you realise you forgot to set up the power before you moved. Unsurprisingly, this is an issue we encounter a lot at Contact and while we will try our best to help you get it sorted ASAP, it is always better to plan for your move ahead of time.
The best part is the process is insanely simple. Whether you’re a new or existing customer, call us on 0800 401 235. All we need is the address you're moving to and your moving date. Or do it online and pick one of our offers, like Saver Plus which gives you $150 off your first bill.   While you’re at it, let us take care of your broadband and gas too.
By Contact Energy