The $167,000 fund ran out in January and was not due to be replenished by the Dunedin City Council until after the new financial year in July.
Since Anglican Family Care began distributing grants from the 2008-09 allocation in September, 676 households had received emergency assistance, budget adviser Heather Trainor said.
It was not uncommon to see applicants coming in with bills "over the $1000 mark", where previously such large bills were rare, she said.
The power companies were to blame "in some respects" as they allowed customers' bills to get so high before contacting them.
"The good majority of people had some sort of `smooth-pay' system," Ms Trainor said.
While the name of these systems varied between companies, they were based on the customer making regular payments of a set amount for their power use.
These payments were calculated on the basis of average monthly consumption over a year and were set by the power company.
However, she believed too many people "weren't cutting the mustard" in terms of their payments.
"They were building up debt, really, because what they were paying did not cover their usage."
Power companies, on the other hand, believed their payment systems were not at fault, with TrustPower blaming the Electricity Consumers Fund itself.
TrustPower had an automatic-payment option, which about 5% of its customers used.
It was a good option for people on fixed incomes, community relations manager Graeme Purches said.
If a customer's bill climbed to a high point, about $200 in debt, and it looked as though annual consumption had increased, the company would contact them to review their monthly payment.
"I've never heard of people getting into trouble because of the system."
He encouraged people to contact the company if they had any problems.
However, he believed if such community funds were not available, people would not get into so much trouble.
"The people who most often get into trouble know it's there."
Consumers should also know how much their bills were and how much power they used.
"They [bills] are not unforeseen and are not exceptional."
If customers really were in dire straits, they should seek help from government social agencies or the power company itself to get "them over the hump", he said.
"They have the wrong end of the stick if they are blaming smooth pay," Mr Purches said.
Contact Energy used the name "smooth pay" for its similar service.
Communications manager Jonathan Hill said any issues around the system had not been drawn to his attention.
"In our experience the scheme is working really well."
He said it was designed to ensure a consistent amount of money was paid through the year; sometimes a customer would be in debt and sometimes they would be in credit.
"It takes out the peaks and troughs," he said.
Customers' energy use was reviewed three times a year. If an adjustment in payment amount was required, the company would notify the customer. Mr Hill said new appliances or the number of people living in a property could impact on power usage.
A "significant number" of customers used the service and he encouraged anyone experiencing difficulty in paying their bills to contact the company to sort it out.
"Disconnection is an absolute last resort. We would work closely with them to get them back on track."
In order to combat the problem, Ms Trainor believed Work and Income New Zealand needed to look at the size of the families they worked with and increase benefits accordingly.
Petrol, food and power prices all increased during the past year while benefits remained the same, she said.
