Meridian traditionally had been a major electricity generator, but only a small retailer. In 2006, Ari Sargent, an electricity industry veteran, had an idea to increase Meridian's market share in the retail market: turn electricity from a utility into a consumer good. Initially, it was planned to sell electricity tokens in supermarkets, but that idea was scrapped due to cost and they turned the idea to the Internet. Sargent, with Simon Coley, a design specialist, founded Powershop in September 2007. In September 2008, Powershop bought its predecessor, Meridian Energy's Marketplace Innovations Business Unit, for NZ$1.26 million in stock. After 14 months of private beta, it officially launched to the public on 22 February 2009 and was unofficially available in the weeks prior.
Reception
Powershop planned on 4–50,000 customers in its first year. Powershop achieved 5000 customers in October 2009, and 10000 customers in February 2010. CEO Ari Sargent blamed this on inertia and general distrust of power companies. Energy expert Molly Melhuish claims that because "people are so terrified of their power bills", "a majority of people" wouldn't want to try a new concept like Powershop. The Consumers' Institute of New Zealand welcomes initiatives to increase retail power competition. In a 2009 survey by the Ministry of Economic Development, Powershop was found to be the cheapest electricity retailer for the typical consumer in Auckland, Wellington, Christchurch, Dunedin, Manawatu and New Plymouth. It was the second cheapest in Wanganui and Wairarapa. In Consumers' Institute of New Zealand's 2009 survey of electricity companies, Powershop gained the highest rating ever in the history of the survey. 92% of Powershop customers found it 'good' or 'very good'. It did not receive a single poor rating from any of its customers. In 2010, it again received a 92% satisfaction rating. In 2011 and again in 2012, it gained a 96% customer satisfaction rating. It was the best company in Consumers' Institute of New Zealand's 2011 survey of electricity companies. In Australia, Powershop is ranked 1st of 15 companies for customer service tracked by social media tracking website, servicerage.com.
