Vineeta Rao
Auckland, June 12, 2025
Independent electricity retailer Frank Energy has announced it will shut down operations in the coming weeks, marking a significant exit from New Zealand’s increasingly squeezed electricity retail market.
The company, which serves more than 100,000 residential customers nationwide, cited a combination of soaring wholesale energy prices, rising operational costs, and a complex regulatory environment as key factors behind the decision.
A spokesperson for Frank Energy said the closure was “not taken lightly,” and reflected their commitment to providing a transparent and fair alternative in a market dominated by major players.
“Despite our best efforts, the financial and structural pressures have made it impossible to continue without compromising our values,” the spokesperson said.
Earlier this year, Frank had already withdrawn from offering natural gas and LPG, citing supply issues and high costs, effective from March 1, 2025.
A Market Under Strain—and Question
Frank Energy’s exit highlights a broader trend of market consolidation. In the past year alone, major movements have reshaped the landscape:
- Meridian acquired Flick Electric
- Genesis consolidated its three brands, Frank Energy, Ecotricity, and Genesis Energy,under one umbrella
- Several small retailers exited the market entirely
In a response to Indian Newslink, the Electricity Authority (EA) acknowledged that “a reduction in the number of electricity retailers in the market may reduce competition and decrease the variety and number of plans on offer.”
“We remain concerned about competition,” said Andrew Millar, the General Manager Retail and Consumer. “Retail competition brings benefits to consumers and small businesses through more choice and access to affordable electricity.”
One of the few remaining independent players, Electric Kiwi, said the market remains tilted in favour of entrenched giants.
“Frank was not exactly frank with its customers. Despite appearances, Frank was 100% owned by Genesis Energy, one of the big four gentailers dominating the market,” said Huia Burt, the Chief Executive Officer of Electric Kiwi.
“Kiwi households and businesses deserve genuine competition—not more brands controlled by the same big players who have every incentive to keep supply tight and prices high,” she added.
Hedge Contracts and Regulatory Gaps
A major challenge for small retailers lies in accessing hedge contracts, financial tools used to manage wholesale price volatility. Without such protection, smaller retailers struggle to stay afloat during high-demand periods when wholesale prices spike.
The Electricity Authority recently reviewed this issue and found that super-peak hedge contracts, which cover crucial morning and evening consumption windows, were in short supply.
These findings have informed the work of the Energy Competition Task Force, a joint initiative by the Commerce Commission and the Electricity Authority, launched in August 2024 to improve market fairness and performance.
“Small retailers are an important part of the electricity market,” Millar acknowledged. “The accessibility and availability of hedge contracts are essential to help all electricity retailers manage their exposure to volatility in the wholesale market.”
The Task Force has proposed new rules to prevent gentailers from offering preferential hedge pricing to their own retail arms, which would help level the playing field for independents. These rules would require gentailers to offer hedge contracts to all retailers on equal terms.
“We are currently reviewing submissions on these proposed rules,” Millar said. “The goal is to enable independent retailers and generators to better compete.”
What It Means for Customers
Frank Energy customers will be automatically transferred to other providers, with no disruption to supply. The company has committed to managing final meter readings and account closures smoothly.
Consumer NZ has advised customers to be proactive.
“Do not panic, but do not wait either,” a spokesperson said. “Use this opportunity to shop around for a better deal.” Platforms like Powerswitch can help compare plans and avoid default pricing.
To protect consumers and enhance transparency, the Electricity Authority has recently introduced a number of new tools:
- Consumer Care Obligations: Minimum service standards for all electricity retailers
- Mandatory retailer reporting: New data requirements from March 2025 to improve oversight of customer experience, prices, and switching behaviour
“These changes will help us protect consumer interests and hold the industry to account,” GM Andrew Millar said. ““Retail competition promotes innovation, fair pricing, and consumer choice. We are focused on removing barriers that disadvantage smaller retailers.”
As New Zealand advances toward a low-emissions economy and greater electrification, a diverse and competitive retail market is essential. But unless structural issues are addressed, independent players may continue to fold under pressure.
The Energy Competition Task Force is also evaluating eight initiatives to boost new generation investment, improve demand-side participation, strengthen competition and put downward pressure on electricity prices. This includes a standardised flexibility product that now trades on the market and offers retailers better protection during high-demand times.
The Road Ahead
Frank Energy’s closure is more than the loss of a single brand—it is a cautionary tale about the fragility of retail competition in a concentrated market.
If regulators succeed in implementing the proposed reforms, the sector may regain balance and diversity. If not, the exits may continue.
“It is not just about keeping the lights on,” said Huia Burt. “It is about ensuring the system remains fair, accessible, and affordable—for all New Zealanders.”
Vineeta Rao is an Indian Newslink Reporter based in Auckland
