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Power pricing not just a rip-off, it’s immoral

Written By: - Date published: 3:23 pm, March 22nd, 2019 - 43 comments
Categories: Economy, uncategorized - Tags: , , ,

Submissions for the final report on the Electricity Price Review closed today at noon.

My recent experience with Genesis Energy reveals pricing by power company majors not only rips customers off, but is immoral.

The initial report of the EPR is unlikely to address this issue.

My enlightening experience began with Genesis informing me late last year that the pricing regime applying to my account was being “reviewed”- ie the gas price was being hiked to $0.0809 cents per kWh from $0.0483 – a 67% hike.

When I wrote to Genesis to tell them I thought the hike was outrageous, especially considering my electricity bill had gone up 14% over the last year, and that I would be “reviewing” my relationship with the company, I received an email from the Genesis “movers team” offering me a new contract at the old price.

Only because I am the sort of person who roughly knows my way around systems was I able to get the price hike revoked (though I wasn’t smart enough to stop Genesis hiking my electricity price 14% in 2017 when the inflation rate was under 2%).

When I asked for an explanation of how, suddenly they were able to offer me a new deal at the old, much lower rate, I received this response: “The reason why you (sic) rates were increasing in price as those are our non-contracted standard rates. With (sic) accepting out (sic) eSaver contract, we were able to fix your rates onto our lowest regional rates available.

The question is: what happens to people with less ability to push back? Essentially we have a system where the vulnerable end paying higher power prices than the less vulnerable.

Exploitation of the vulnerable also happens via the widespread practice of prompt-payment discounts, which Genesis still operates. These can be as high as 26% of the bill. Budgeting and advocacy groups say those discounts are really late-payment penalties. The discounts again favour those in society who are organised and have the wherewithal to always pay on the due date.

This unwelcome practice was highlighted in the current industry review that came about as a result of NZ First’s decision to go with a Labour-led government.

Meridian Energy responded to the review’s recommendation to end the practice by giving everyone the discount rate, at a cost of $5 million to the company. Those of Meridian’s 18,000 customers who will no longer be penalised for paying their bills late will save around $20 to $30 every month.

The review’s initial report highlighted the market has developed into a two-tiered beast between those who shop around to enjoy the benefits of competition and those who do not and pay higher prices.

Genesis, known in the jargon as a gentailor (because it is generator and retailer), is the largest electricity retailer, with around a quarter of the electricity market and 40% of the gas market. The 51% government-owned company is the third largest electricity generator. It was formed as part of the 1998–99 reform of the New Zealand electricity sector, taking its one generation capacity from the breakup of Electricity Corp of New Zealand (ECNZ). In April 2014, the National Government sold a 49% stake at $1.55 per share (today $2.68, and that is another sordid story).

Since deregulation of the energy sector began, households are paying 80% more for power today than in 1990, after adjusting for inflation. It is estimated about 103,000 households spent more than 10% of their income on domestic energy – a situation described as “energy hardship”.

The first stage of the industry review was delivered in September. According to Energy Minister, Megan Woods, “the report is a clear demonstration that the market is not working for everyone. New Zealanders deserve affordable electricity, but too many households are struggling to pay their bills.

In her news release, Woods alluded to the problem identified in my pricing “review”.

For residential customers it appears that a two-tier retail market is developing. People who actively shop around enjoy the benefits of competition, and those who don’t are stuck with prices.

The average gap between what you might be paying, and the cheapest on offer, has increased by about 50% since 2002.

The review has found that some households struggle to understand the various plans and how to choose the one that’s best for them, and low-income consumers miss out more often on prompt-payment discounts – which can be as high as 26 per cent of the bill, and which budgeting and advocacy groups say are really late-payment penalties,” Woods said.

According to the review, electricity prices have essentially stabilised since 2015. (That clearly did not stop Genesis hiking my price by 14% in 2017.)

Stabilisation has resulted from people shopping around when confronted with a hike. The industry is plagued by very high rates of “churn”, where customers jump from retailer to retailer to avoid the kind of hike Genesis tried to push onto me. That trend is encouraged by public campaigns such as “What’s my number” and pro-market advocates would argue that this shows the market is working.

Acquiring new customers by providing incentives, or by knocking on their front door until they jump ship, is expensive and is again essentially paid for by vulnerable customers. Estimates range from $200-300 to acquire a new customer up to the thousands that Z Energy recently paid for Flick in its desperation to diversify.

In August, all the big retailers, except Meridian, lost customer connections. Contact Energy reported the largest loss of more than 3700 customers, although 2000 of those were due to the Auckland Council moving to Trustpower. The biggest gainers were the Tier Two retailers – Electric Kiwi, Pulse Utilities, Energy Club, Switch Utilities, Ecotricity, Nova and Flick Electric.

Customer churn can also be very disruptive to power companies. Flick lost 3,500 customers in two months following wholesale power price spikes in October. Companies are aware of the dangers of large-scale customer loss and price their offerings according. So we all end up paying for this churn, but generally some pay more than others.

 

Simon Louisson is a former reporter who worked for The Wall Street Journal, AP Dow Jones Newswires, New Zealand Press Association and Reuters and as a political and media adviser to the Green Party

43 comments on “Power pricing not just a rip-off, it’s immoral ”

  1. Ad 1

    Great to see Vector get a $3.5 million fine for the power outages last year.

    https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12215296

    Big ups to the Commerce Commission litigation team for the win.

    Also thankyou Justice Duffy.

    Now, I know this post is about pricing, not lines and supply.

    But it’s so rare these days to see a major get one in the eye for the consumer.
    They could have spent that fine on undergrounding their lines in Auckland’s west.

    Vector you are a shit organisation and your customer service and commitment to Auckland sucks wholesale.

    Hope every bit of that fine comes off your bonuses.

    • Dukeofurl 1.1

      Not for last years ‘hurricane’ , was earlier

      “which resulted in it breaching the Commission’s regulations on quality standards in the 2015 and 2016 financial years.”

    • Paaparakauta 1.2

      Is that Jacinda in the image above saying ‘Help’ ?

    • Graeme 1.3

      Waiting on the “naughty step” for the same sort of prosecution is Aurora, the Central Otago and Queenstown Lakes lines company.

      https://www.odt.co.nz/regions/central-otago/aurora-explains-itself-codc

      Aurora’s owner, Dunedin City Holdings ripped the guts out of the company to fund the Dunedin Stadium, resulting in no maintenance on a network that already had a huge deferred maintenance issue. So there’s been poles fall over outside Clyde School (fortunately no kids standing there at the time, if it had gone a few hours earlier would have been messy), poles come down with someone working on them (fatal) and in some streets most of the poles with red, “No Climb” tags.

      And then they had the cheek to go to the Electricity Commission wanting to put charges up to fix it. That’s gone strangely quiet.

  2. For residential customers it appears that a two-tier retail market is developing. People who actively shop around enjoy the benefits of competition, and those who don’t are stuck with prices.

    Its called ‘The Loyalty Penalty’.

    Some consumer group should run an advertising campaign on behalf of businesses with a “loyalty Penalty”, they need to be outed, but NOT to make us change providers…to make them lift their game.

    https://www.theguardian.com/money/2018/dec/19/watchdog-plans-price-caps-to-stop-4bn-loyal-customer-rip-off

  3. WeTheBleeple 3

    I had a very similar experience. I wrote them complaining the bill was too high and they gave me a hefty discount. I inquired why this discount was not default, and how many others were they fleecing etc. They replied how they were.

    ‘taking it under consideration’

    That was Mercury.

    Same animal, different coat.

  4. cleangreen 4

    We know that the electricity price is a ripoff as the base price should be abut half of what it is here in line with the majority of the OECD.

    https://www.oecd-nea.org/ndd/pubs/2015/7057-proj-costs-electricity-2015.pdf

    Hydro: Hydroelectric plants are very site-specific, and so one would therefore expect to see a wide range of costs.

    Overnight costs for small hydro plants (10 MW or less) range from USD 1 368/kWe in the United States to USD 9 400/kWe in Germany.

    For large hydro plants in OECD countries,

    overnight costs range from USD 1 195/kWe in Spain to USD 8 687/kWe in Japan. In non-OECD countries they range from USD 598/kWe in China to USD 3 971/kWe in Brazil.

    Privatising the ‘essential service’s was a crime here, as we built them for ourb serurity and National flogged them off and we got shafted.
    .

    • Dukeofurl 4.1

      The power price we pay isnt set at the ‘lowest cost’ , rather its the highest cost provider sets the cost for all- for each half hour period. So varies through out the day.

      Some people are unfortunately comparing price rises to inflation – doesnt work that way as shortages rachet up prices considerably and if you are on a fixed price contract for the year the increased price for short periods is considered in setting the next years fixed price.

      Power prices are more like the price of potatoes, wholly dependant on supply and subject to weather related swings .
      In theory they should swing down as well but they rig the available supply to reduce that chance.

    • Ian 4.2

      The green party destroyed a big hunk of the value of those shares.You need to look at the unintended consequences of your activism. You cost taxpayers a lot of dosh and you provided investors a cheap buy.Your immediate need at the moment is to silence your hate filled spokeswomen.

  5. We were told in the 1980’s that power prices would drop after freeing up the market under neoliberalism.

  6. cleangreen 6

    While our use of power is dropping the cost is rising according to these sets of global power consumption, NZ is dropping. So should the cost per KW.

    Use the common model of if it is scarce then the cost rises.

    So we are being ripped off all the way to the bank folks.

    Electric power consumption (kWh per capita)
    IEA Statistics © OECD/IEA 2014 ( iea.org/stats/index.asp ),

    https://data.worldbank.org/indicator/eg.use.elec.kh.pc

    • Dukeofurl 6.1

      data is out of date.
      GFC effects reduced growth in power consumption, may have even reduced it, economic boom since then has changed all that.

      We are very susceptible to weather related shortages of hydro lake storage. Lots of rain and winter snow increases flow through South Island power stations. Its a complicated system but projected say winter hydro flows leads to power companies buying future hedging contracts driving up the price.
      A recent instance over a shutdown of a natural gas pipeline for maintenance has led to suggestions one of the retailers knew in advance and was able to buy hedging contracts for a low price before the others knew who tried to do the same thing but at higher price, a really high price. ( I hope I have got all details right)

    • RedLogix 6.2

      It’s worth noting that when it comes to utilities like power and water, the dominant component of the pricing comes from fixed costs. In the case of your water supply I know it’s usually 90% of the total price.

      For instance when I was in the water business, our wholesale price to the councils was 50c/m3, while as long as demand stayed within our production capacity, the marginal cost was 5c/m3. Roughly. I’m not sure how the numbers stack up in the electricity game, but I’d be fairly sure the fixed costs (capital, maintenance, labour, etc) would be the dominant portion.

      This means that as consumption drops, the price per unit rather perversely has to rise in order to be able to keep the system running. Eventually if demand drops enough, the system will shed fixed costs by closing plant, etc, but this tends to be rather sticky and comes in big lumps at long time intervals.

  7. Thank Labour and Roger Douglas.

  8. Naki man 8

    I don’t know what all the fuss is about. My power bill is just over $100 a month this time of year. A little more than my internet bill and less than a tank of petrol.
    If you own the house you live in and think you are paying too much it is very easy to reduce your bill, unfortunately not so easy if you are renting.

  9. cleangreen 9

    I have been finishing two other recent studies and the stats now show we are being ripped off no fear here.

    Since the 2014 world bank study, we have decreased our own use of power every year since, we found the stats show.

    Our use has fallen since 2014 again to less than average of 8939kWe per individual annually from 9026 in 2014.

    So clearly we are really being ripped off alright by these fat cats running our formerly ‘public owned power companies using the excuse that power generation is lagging behind ouur demand as it has not incresed since 2014..

    Shame on them!!!!

    • Tuppence Shrewsbury 9.1

      consumption dropping does not equal a price drop. Please publish your study so we can assess your conclusions

  10. KJT 10

    One aspect that hasn’t been mentioned, is power companies overcharging retail customers, to finance their discounts to attract large businesses.

    Power is a case study, on the inefficiencies of “privatisation” and ” competition” in large essential infrastructure.

    And a total refutation of the raving that “private companies are always better than State control”.

    • RedLogix 10.1

      I agree with you on that totally. I recall from some years back a study done that compared the network costs between the electricity system and the water system in Wellington, and what happened in the decade after privatisation of the former, while the water supply remained public.

      I forget the exact numbers, but the water system real costs rose about 18% in that time, while the electricity sector rose something like 170%. Someone bite me if I have those numbers wrong, but the difference was stark. I recall linking to the document years back.

    • Andre 10.2

      One aspect that hasn’t been mentioned, is power companies overcharging retail customers, to finance their discounts to attract large businesses.

      Yup. The Electricity Retailers Association says so themselves, though they put marketing weasel spin on it.

      https://www.eranz.org.nz/fileadmin/user_upload/ERANZ-_electricity_prices_in_NZ_-_an_historical_and_current_context_-_June_2017.pdf

  11. A 11

    I remember that I moved out of Lower Hutt just before the cut off for being considered a resident and therefore owner of some power co. Missed out on over a grand in payout.

    Made me think we needed more people owned power co’s

  12. WeTheBleeple 12

    I’ve been thinking about this. Possibly cause a war…

    Private companies gouge profit. We know this no matter how pretty their PR folks are.

    I propose we claw the power companies back and force these private players in line with fair practice and public service provision. Power in NZ is a basic necessity not a luxury.

    Buy them out, one chunk at a time taking their shares and turning them back to NZ’s asset as they are meant to be.

    Force their pricing to stop them over-inflating their sense of worth.

    Force their maintenance to stop them stalling business and activity.

    Force them to act like responsible business till all the opportunists have abandoned ship.

    • Stuart Munro. 12.1

      Agreed. One of my NZ power bills would pay for a year’s power in Korea, with change left over. NZ power companies are taking the piss.

      • CLEANGREEN 12.1.1

        Yes WeTheBleeple and Stuart,

        My Son is living back in Germany, and pays only a third of our cost of our power bill here for us two, – at his home there.

        Considering he and his fiance’ is in a deep winter period there now, and we are in a far warmer period here.

        So for our winter; – it will be of cold comfort knowing that Germany’s power costs are far less than ours, is ‘criminal’ for us to be forced to face here.

        Especially since I spend my best years working on two large power schemes in NZ building public hydro power projects so our future would be sure with cheap power.

        What a ripoff!!!!!

        We have been robbed here in NZ by these overseas “leeches”.

        • Dukeofurl 12.1.1.1

          In Europe I think its only France that is similar to NZ in that electricity supplies the majority of home energy use.
          I know for UK most homes have natural gas for home heating and hot water , the ubiquitous ‘boiler’ tucked away somewhere, anmd maybe even the stove is gas. This way their electricity usage is a small part of their energy use.
          Germany may be the same as UK , so perhaps ask your Son about the natural gas – maybe its part of an apartment block that shares the heating via radiators , so electricity may only be lighting and home electronics ?

          The comments from Ballarat may also rely on natural gas , for heating, hotwater and stove. More recently electricity prices in Victoria have soared as the move to more renewable forms has replaced old brown coal ( the worst kind) of power stations

          • cleangreen 12.1.1.1.1

            Germany uses electric ranges mainly (my son a NZ master electrician said).

            They also use electric underfloor heating systems too.

            I lived in Canada for 3 decades on and off, owning three properties and all had “forced gas griddle heated air heating systems: which were bloody dangerous.
            Our system of good insulation with ‘wool’ is adequate for our mild climate also.

            • Dukeofurl 12.1.1.1.1.1

              “Gas central heating is the most widely used type of heating system in Germany. ”
              https://www.wolf.eu/en/advice/heating/gasheatingsystem/

              My household of two probably averages $100 pm over year and I have two heat pumps, the upstairs one is mostly used for cooling over summer nights – using dehumidify option as thats the problem , humidity rather than excessive hot.
              My annual consumption 3813 kWh ,year on last Aug, means Im at the low end of a ‘low user’, but have the usual washing machines and dishwashers etc. I take care to turn major appliances off at the wall after use, including computer gear

              • Dukeofurl

                “A typical household buying from a local supplier that consumes 5,000 kilowatt hours a year is now paying 1,437 euros per annum”
                https://www.reuters.com/article/us-germany-energy-retail/german-consumers-paying-record-prices-for-power-portal-idUSKCN1P9233

                Thats maybe twice ($2350 ? )what I pay($1071) for a similar kWhr

                Thats ALL my household energy , while those in Germany are mostly paying extra for natural gas heating on top of 5000 kWhr – which is quite low

              • cleangreen

                Many countries have electricity prices at least half or much less than ours.are now because the base price is high here by extra ‘taxes’ and ‘ripping us off’ by using extra line and transmission charges and metering equipment charges are ‘silently added by the power company’ like NZ companies has done so now.

                Note; some are out of date as NZ and Australia are but we can use them for comparisons from then to now as historic references.

                Try NZ in 2012 cost of average power per kW was around 19c and now we are now up to 35c in areas such as Gisborne rural areas are.

                Germany has high kW cost of (33 EU) – but my Son says their yearly cost now in Germany is lower by far than ours are even today in 2019.

                I commend Dukeofoul for keeping his/hers average monthly kWs down to “averages $100 pm over year ” That is amazingly low even for two.

                Here are some stats to prove this fact that many countries have far lower cost than we or Australia has so knowing that the same global folks operate the Australian electrical providers do so in NZ now, so we need to have these high cost companies investigated for corrupt practices now.

                Argentina 9 2016
                Australia 11-26 2016
                Belgium 27 2015
                Bulgaria 11 2015
                Brazil 12-25 2016
                Canada 8-16 2016
                China 5-14 2016
                Chile 23.11 2011
                Croatia 15 2015
                Czech Republic 14.75 2015
                Denmark 33 2015
                Finland 17.51 2015
                France 19.23 2015
                Germany 33.76 2015
                Guyana 26.8 2012
                Hungary 23.44 2011
                Hong Kong 12.02-24 2013
                India 7 2014
                Indonesia 8.75 2013
                Iceland 14.5 2015
                Iran 2-19 2011
                Ireland 28.36 2011
                Israel 15.35 2017
                Italy 28 2015
                Jamaica 7.35-16.8 2011
                Japan 18 2015
                Jordan 5-33 2012
                Latvia 18.25 2012
                Malaysia 7.09-14.76 2013
                Mexico 19.28 2012
                Moldova 11.11 2011
                Netherlands 28.89 2011
                New Zealand 19.15 2012
                Pakistan 2-18 2015
                Papua New Guinea 29 2013
                Paraguay 8 2011
                Peru 10.44 2007
                Philippines 30.46 2010
                Portugal 25.25 2011
                Russia 9 2014
                Serbia 3.93-13.48 2013
                Singapore 21.53 2013
                Spain 19.72 2017
                Solomon Islands 84.8 2013
                South Africa 15 2015
                South Korea 8.1-62 2016
                Sweden 21.5 2015
                Taiwan 7-17 2012
                Thailand 4.46-9.79 2011
                Tonga 57.95 2011
                Turkey 11.2 2016
                United Kingdom 25 2015
                Ukraine 2.6-10.8 2014
                Uruguay 17.07-26.48 2014
                United Arab Emirates 0-12 2017
                United States 12.7 2017
                USA Virgin Islands 51-55 2013
                USA Hawaii 30.33 2017
                Uzbekistan 4.95 2011
                Vanuatu 58 2013
                Vietnam 6.20-10.01 2011

                • Dukeofurl

                  Based on my numbers German electricity prices are ‘twice’ that of a low user in Auckland ( How is their GST?)
                  Yes some rural areas here have very high lines charges

                  My only ‘trick’ is to have the hot water turned off except for 51 min per day -yes I use a timer- before the morning showers. In winter it goes up to around 80 min. In theory it shouldnt make much difference but I found it did. ( water comes from the hot part of the cylinder – the top- while cold water comes in the bottom where the thermostat is and immediately turns the element on to mix the water. I just have enough water used so that the cold water stays at the bottom till the next day)

                  I can remember years ago being surprised by people who left electric heaters on in rooms all night!
                  To me the main thing was a warm dry bed , by using an electric blanket before going to sleep. And about once a fortnight or so leaving it on very low setting for say 4-5 hours to drive the moisture out of the bed. damp beds require more heating.

                  • cleangreen

                    They stupidly got rid of the ‘ripple relay system’ of the ‘controlled’ side of all home electricity systems sadly.

                    We had always included them in distribution boxes attached to all homes then to restrict overnight water heating when high line demand was present so we had a lower water electricity charge in all homes where some would connect their heaters to the “controlled side of the electricity supply.

                    As an electrician i was amazed when a Contact energy guy suggested we do this.

                    All power providers should offer any service that would lower customers costs also like this.

                  • cleangreen

                    Dukeofurl; My son just emailed his thoughts on the German prices here,;-

                    “30 cents euro per kWh, that’s gone up from 25 cents since 2010. We generally only use electricity for cooking, I’ve never actually come across any house that hasn’t!
                    They use a central heating system which the water heating is tied in with and the main source of heating are natural gas boilers, heat pumps, district heating system which means they have heating plants supplying heat (biomass and coal plants), and also wood and wooden pallet based heating systems

                    We also pay our power annually. So 750-1450 euros a year
                    I’ve generally only paid 750-1000euros a year.”

                    We here average $250NZ a month (a lot more than you do) as you are wisely using less power than most.

                    I need electricity here due to severe allergies to gas or wood fire emissions.

                    We do use much more cost then my son and his partner do in Germany.

                    Canada was much cheaper than NZ or Germany at only 12 cents a kWh. US at 11 cents so we are very high here.

                  • Andre

                    Do you occasionally make sure the whole cylinder gets up to at least 60 degrees? If not, then the risk goes way up of cultivating a delightful little colony of Legionnaire’s disease in your hot water cylinder.

      • RedLogix 12.1.2

        Similar experience even in Australia. I remember my shock at our first power bill in Ballarat, it was was similar to the ones we got in NZ, except it covered a whole quarter, not one month!

    • Jess NZ 12.2

      Yes, socialist of me I know, but I think that utilities required for civilised living should be nationalised, not privatised. The profit motive increases the already immoral divide between rich and poor in NZ.

      So power, water, transport, health and ‘communications’ should all be free of the profit requirement.

      Rich people will always be able to buy a better deal, but the rest of us shouldn’t be propping up already rich investors.

  13. WeTheBleeple 13

    Yeah we’re certainly getting gouged aye. Maybe part of it is due to having a smaller consumer base, but not all of it.

    To ensure good (renewable hydro) power supply in our future we will also need to address the retention of water in our landscapes. Not only to ensure power supply, but for stream health and life, and primary production – our biggest earner.

    The way all of this fits together where conservation enhances power and economy is the type of opportunity we should keep our eyes open for.

    Building resilience in our systems.

    NZ Forever.

  14. Herodotus 14

    Simon your story is very similar to mine, had a 24 month price freeze. Recently the 24 mth period lapsed. We received a letter stating that all rates: Fixed and variable were to be “lifted” by 22-34%. From visiting http://www.switchme.co.nz i was able to find a supplier that was able to match our rates from 2 years ago. 4 days after completing the process I was rung from the current power coy with a counter offer, like you offering a dramatic lower rate and as a goodwill gesture $300 credit on the account. I used this opportunity to voice my frustration and from principle did not accept their offer.
    I wonder how many “passive” customers these coys have that just accept such increases.
    Wasn’t the power shake up to benefit the consumer ??? 🥴
    Should have purchased all those shares that our govt sold a few years ago 🤑

  15. Slijmbal 15

    Must agree with the point made earlier that while there is competition it is not provided to the consumer as a natural consequence, rather it has to be quite actively sought out. We have the cosmetic appearance of a competitive market but not an actual one.

    Electricity costs have 3 main components; generation, transport (Transpower) and ‘retail’. Haven’t been able to dig out what proportion of our costs are in each but from memory all 3 components are major contributors to the cost.

    The government owns ~ 2/3rd of power generation and owns Transpower and the 5 main generators who generate almost all power in NZ are also the 5 main retailers (with less domination than in generation but still a large amount of market share – I don’t have numbers to hand). This certainly looks like a cartel. A Government owned one.

    We also have a pricing model for wholesale prices that is poorly constructed that can easily be gamed by the generators to increase profit. Furthermore, we have a poor model of setting how much profit the electricity companies are allowed. In crude terms it is priced by valuing their assets, setting an acceptable level of return on these assets and then being able to set prices accordingly. Getting assets artificially increased in value allows a corresponding increase in price and thus profit.

    Ironically, with majority government ownership and government set rules for profit and pricing this is actually a government caused problem and not a private industry one IMO. Even more ironically, the largest proportion of price hikes (%age wise) have been applied under Labour governments. National are also guilty of this behaviour, just not as much. It’s been treated as a stealth tax by governments for ~ 20 years.

    Electricity supply has so many built in impediments to competition e.g. very high capital costs and easy to repel new entries to the market, it’s not sensible to have 2 Transpowers etc. etc. that competition can only be enforced by market intervention. I worked in the electricity industry prior to de-regulation and wasn’t impressed by what I saw then so I’m not in favour of nationalisation and would rather fix what we have than overturn it. I don’t see any government intervening soon as it will mean increased taxes elsewhere.

    On a final note, this will only get worse with moves around removal of fossil fuels in the mix as it’s become much more difficult to create economically reasonable, renewable generation in NZ. For instance, Hydro requires new damns, which are invariably strongly opposed. Other renewables such as wind and solar are not even close to economically competitive and a long way from being so, if ever, in the New Zealand environment.

  16. cleangreen 16

    Slijmbal

    Excellent review you made.

    I have a company that works within the Electricity industry in a “partnership” with the Electricity Authority (EA) as an (MEP) ‘Meter Equipment Provider’ and also as a (MEO) ‘Meter Equipment Owner’ where my activities are all controlled by the EA and often our similar companies that are small like ours are discriminated against by the Power providers and we are unable to supply services to customers that they want as the power providers will not allow us to represent the consumer to carry out installations of our equipment which can save the consumer money in lower bills.

    So yes there are anomalies in the electricity industry now and the potential for some electricity providers to ‘play’ the system to reach higher profits with to much power given to the electricity providers over consumers rights to choose there services offered inside the electricity equipment industry.

    We have on several times provided our company input submissions to the EA but seldom has anything changed.

    We hope that the tenacious excellent prowess of our new Energy Minister Megan Woods will correct those issues and give consumers better right to use their preferred Meter equipment Provider to supply better metering to give the consumer lower bills, as some electronic digital metering is known to be very unstable whereas the older mechanical ‘ferraris’ spinning wheel’ metering that has been used for 60+ years has proven to be is more accurate in most climatic conditions.

    Most Electricity Providers will also benefit from a more reliable stable reading of use at every location without having to deal with customers disputes also.

    Main benefits also are for property owners with solar backup power systems as these mechanical spinning wheel meters reverse the reading when power from the home is generated and returned to the grid is shown accurately as a credit of 100% back to the homeowner by debiting the power returned to the grid.

    Simply this give will give more control of use and lowed bills back to the customer.

  17. hoom 17

    I will never forget Max Bradford on the day he announced the splitting of ECNZ:
    “NZ electricity prices will never be as low as today”

    It was a Bushism but has been proven absolutely literally true, prices nearly immediately rose significantly and continued inexorably upward since.

    What annoys me is we had 9 years of Labour with no real improvement to what was already very clearly a broken-to-the-core system in that time.

    I see no sign that this Labour govt will do anything other than a minimal & ineffectual adjustment round the edges.

    A ‘market’ setup to always choose the most expensive price is not a market, its a Cartel.
    And it makes no sense for separate companies owned by the Govt to be run as a Cartel. (nor as an actual market)

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  • Building back better
    It’s a three-week recess in Parliament – so, no bills are going through the House and no select committees are meeting. But the hard work of our ministers continues, and many of our MPs are back in their electorates, taking the opportunity to meet with local communities and businesses about ...
    5 days ago
  • Greens call for a Warrant of Fitness for rental homes
    The Green Party is launching a petition today calling on the Government’s Healthy Homes Standards to be backed up with a proper Warrant of Fitness (WoF) for rental homes. ...
    1 week ago
  • Securing our recovery: By the numbers
    Our plan to secure New Zealand’s recovery from COVID-19 is working, with the past three months seeing the second-highest number of people moved off a main benefit into work since records began. ...
    2 weeks ago
  • More Kiwis in work through recovery plan
    The latest statistics show the Government’s focus on jobs is working. The net number of people on a main benefit dropped by around 11,190 people during the past three months, with around 31,240 people moving off a benefit into work. ...
    2 weeks ago
  • Green Party appoints new Chief of Staff
    The Green Party has appointed a new Parliamentary Chief of Staff, Robin Campbell. ...
    2 weeks ago

  • Next step to protect Milford Sound Piopiotahi
    Expert group lays out plan to better protect iconic UNESCO World Heritage site Milford Sound Piopiotahi and its surrounds Funding confirmed for dedicated unit and Establishment Board to assess the recommendations and provide oversight of the process from here Milford Opportunities Project a test case for transformational change in tourism ...
    BeehiveBy beehive.govt.nz
    14 hours ago
  • Funding for projects to reduce waste from construction and demolition
    The Government has announced funding for projects in Auckland and the lower North Island to help reduce construction and demolition waste. “Construction is the main source of waste sent to landfill, and much of this could be reduced, reused and recovered,” Environment Minister David Parker said. “The Government is funding ...
    BeehiveBy beehive.govt.nz
    14 hours ago
  • Plan to eliminate hepatitis C as a major health threat by 2030
    A plan to eliminate hepatitis C in New Zealand, reducing liver cancer and the need for liver transplants, has been released today by Associate Minister of Health Dr Ayesha Verrall. “Around 45,000 New Zealanders have hepatitis C, but only around half know they have it,” said Ayesha Verrall. “Symptoms often ...
    BeehiveBy beehive.govt.nz
    15 hours ago
  • School upgrades and new classrooms for West Coast, Tasman and Canterbury
    A funding injection from Budget 2021 to complete four shovel ready projects and new classrooms at six schools and kura will provide a real boost to local communities, Minister Dr Megan Woods announced today. “This Government has committed to providing quality fit for purpose learning environments and 100,000 new student ...
    BeehiveBy beehive.govt.nz
    17 hours ago
  • Warmer Kiwi Homes smashes annual target
    The Government's highly successful insulation and heating programme, Warmer Kiwi Homes, is celebrating a key milestone with the completion of more than 38,000 insulation and efficient heater installs in the year to the end of June, smashing its target of 25,000 installs for the year. “The Warmer Kiwi Homes scheme ...
    BeehiveBy beehive.govt.nz
    1 day ago
  • Exemption granted for Wallabies to enter NZ
    Bledisloe Cup rugby will be played in New Zealand after the Australian rugby team received an economic exemption to enter New Zealand. Travel between Australia and New Zealand was suspended on Friday for at least eight weeks following the worsening of the COVID outbreak across the Tasman. New Zealanders have ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Minister of Foreign Affairs makes three diplomatic appointments
    Foreign Affairs Minister Nanaia Mahuta today announced three New Zealand Head of Mission appointments. They are: Mike Walsh as Ambassador to Iran Michael Upton as Ambassador to Ethiopia and the African Union Kevin Burnett as Ambassador to Indonesia Iran “Aotearoa New Zealand has a long-standing and constructive relationship with Iran, despite a ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Enhanced Task Force Green Approved for West Coast and Marlborough
    The Government has activated Enhanced Task Force Green (ETFG) in response to the West Coast and Marlborough floods, Social Development and Employment Minister Carmel Sepuloni announced today. “To assist with the clean-up, up to $500,000 will be made available to support the recovery in Buller and Marlborough which has experienced ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Govt support for upgrade of Eden Park players facilities
    Minister for Sport and Recreation Hon Grant Robertson has announced funding to upgrade the players facilities at Eden Park ahead of upcoming Women’s World Cup events. Eden Park is a confirmed venue for the Rugby World Cup 2021, the ICC Women’s Cricket World Cup 2022, and a proposed venue for matches of ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • More jobs and quicker public transport motoring towards West Auckland
    Work to improve public transport for West Aucklanders and support the region’s economic recovery by creating hundreds of jobs has officially kicked off, Transport Minister Michael Wood announced today. Michael Wood and Auckland Mayor Phil Goff this morning marked the start of construction on the Northwestern Bus Improvements project. It ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • Government backs critical health research
    Research into some of New Zealanders’ biggest health concerns including cancer, diabetes, and heart disease is getting crucial support in the latest round of health research funding, Health Minister Andrew Little announced today. The funding, awarded through the Health Research Council of New Zealand, covers 31 General Project grants ($36.64 ...
    BeehiveBy beehive.govt.nz
    2 days ago
  • New Bay of Islands hospital facilities to bring services closer to home
    Prime Minister Jacinda Ardern and Health Minister Andrew Little have joined a ceremony to bless the site and workers for Phase Two of the redevelopment of the Bay of Islands Hospital in Kawakawa today. The new building will house outpatients and primary care facilities, as well as expanded renal care ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Raukokore re-imagined with ‘smart’ relocatable rent to own housing
    Iwi, Crown Partnership Relocatable, fully insulated housing, connected to a new solar plant Provides a pathway to home ownership New housing in the remote eastern Bay of Plenty community of Raukokore shows how iwi and Crown agencies can work together effectively to provide warm, dry, energy efficient homes in a ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Cabinet accepts Turkish authorities’ request for the managed return of three NZ citizens
    Cabinet has agreed to the managed return of a New Zealand citizen and her two young children from Turkey, Prime Minister Jacinda Ardern announced today. The three have been in immigration detention in Turkey since crossing the border from Syria earlier this year. Turkey has requested that New Zealand repatriate ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • Govt delivers more classrooms so children can focus on learning
    Extra Government investment in classrooms and school building projects will enable students and teachers to focus on education rather than overcrowding as school rolls grow across the country, Prime Minister Jacinda Ardern and Associate Education Minister Kelvin Davis say. The pair visited Ruakākā School in Whangārei today to announce $100 ...
    BeehiveBy beehive.govt.nz
    3 days ago
  • New station a platform for AirportLink to take off
    Every Aucklander with access to the rail network will now have a quick and convenient trip to the airport, Transport Minister Michael Wood and Auckland Mayor Phil Goff said during the official opening of the new Puhinui Interchange today. The new interchange links the rail platform with a new bus ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • 10 days sick leave for employees delivered
    Legislation doubling employees’ minimum sick leave entitlement to 10 days comes into effect today, bringing benefits to both businesses and employees, Workplace Relations and Safety Minister Michael Wood announced today. “Our Government is delivering on a key manifesto commitment to help Kiwis and workplaces stay healthy,” Michael Wood said. “COVID-19 ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Prime Minister congratulates Fiame Naomi Mata’afa on Election Win
    Prime Minister Jacinda Ardern tonight congratulated Prime Minister-elect Fiame Naomi Mata’afa on her victory in the Samoa’s general election. “New Zealand has a special relationship with Samoa, anchored in the Treaty of Friendship. We look forward to working with Samoa’s new government in the spirit of partnership that characterises this ...
    BeehiveBy beehive.govt.nz
    5 days ago
  • Quarantine Free Travel with Australia suspended
    Quarantine Free Travel from all Australian states and territories to New Zealand is being suspended as the Covid situation there worsens, Prime Minister Jacinda Ardern and COVID-19 Response Minister Chris Hipkins announced today. From 11.59pm today Australians will no longer be able to enter New Zealand quarantine-free. This will be ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Growing conservation efforts in Gisborne
    A big injection of Jobs for Nature funding will create much-needed jobs and financial security for families in TeTairāwhiti, and has exciting prospects for conservation in the region, Conservation Minister Kiri Allan says. “The projects target local communities most affected by the economic consequences of COVID 19 and are designed ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Flood recovery given further assistance
    The Government is contributing a further $1 million to help the flood battered Buller community, Acting Emergency Management Minister Kris Faafoi announced today. “Buller is a small community which has found itself suddenly facing significant and ongoing welfare costs. While many emergency welfare costs are reimbursed by Government, this money ...
    BeehiveBy beehive.govt.nz
    6 days ago
  • Funding for five projects to reduce food waste
    The Government is funding five projects to help address the growing problem of food waste, Environment Minister David Parker announced today. “New Zealand households throw away nearly 300,000 tonnes of food every year, half of which could still be eaten. By supporting these initiatives, we’re taking steps to reduce this ...
    BeehiveBy beehive.govt.nz
    7 days ago
  • Temporary Accommodation Service activated for West Coast flooding event
    The Temporary Accommodation Service (TAS) has been activated today - meaning residents on the West Coast of the South Island and in the Marlborough region hit by flooding over the weekend can now access help finding temporary accommodation, announced Associate Minister of Housing (Public Housing) Poto Williams in Westport today. ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Pause to Quarantine Free Travel from South Australia to New Zealand
    Quarantine Free Travel from South Australia to New Zealand will be paused from 11.59am (NZT) tonight, COVID-19 Response Minister Chris Hipkins has announced. However, people currently in the state who ordinarily live in New Zealand will be able to return on “managed return” flights starting with the next available flight, ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • New Zealand condemns malicious cyber activity by Chinese state-sponsored actors
    New Zealand has established links between Chinese state-sponsored actors known as Advanced Persistent Threat 40 (APT40) and malicious cyber activity in New Zealand. “The GCSB has worked through a robust technical attribution process in relation to this activity. New Zealand is today joining other countries in strongly condemning this malicious ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Remarks to Diplomatic Corps
    It is a pleasure to be with you all this evening. Some of you may have been surprised when you received an invitation from the Minister of Disarmament and Arms Control, and I would forgive you if you were. New Zealand is unique in having established a Ministerial portfolio ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Early Pfizer shipment boosts vaccine schedule
    The largest shipment of the Pfizer vaccine to date has arrived into New Zealand two days ahead of schedule, and doses are already being delivered to vaccination centres around the country, COVID-19 Response Minister Chris Hipkins says. “The shipment of more than 370,000 doses reached New Zealand yesterday, following a ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Backing for Bay of Islands predator free effort
    The Government is throwing its support behind an ambitious project to restore native biodiversity and build long-term conservation careers, Conservation Minister Kiri Allan says. Predator Free Bay of Islands aims to eradicate predators from the three main peninsulas in the region, and significantly reduce their impact throughout the wider 80,000-plus ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government commits $600,000 to flood recovery
    The Government is contributing $600,000 to help residents affected by the weekend’s violent weather with recovery efforts. Acting Minister for Emergency Management Kris Faafoi and Agriculture Minister Damien O’Connor have been in the Buller district this afternoon to assess flood damage and support the local response effort. They have announced ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government assisting local responses to heavy rainfall and high wind
    Acting Minister of Emergency Management Kris Faafoi says Central Government is monitoring the severe weather across the country, and is ready to provide further support to those affected if necessary. “My thoughts are with everyone who has been affected by this latest event, particularly communities on the West Coast and ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • PM Ardern chairs APEC Leaders’ meeting on COVID-19
    New Zealand Prime Minister Jacinda Ardern has chaired a meeting of Leaders representing the 21 APEC economies overnight. “For the first time in APEC’s history Leaders have come together for an extraordinary meeting focused exclusively on COVID-19, and how our region can navigate out of the worst health and economic ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Health Minister welcomes progress on nurses’ pay
    The New Zealand Nurses Organisation’s decision to take the Government’s improved pay offer to members and to lift strike notices is a positive move towards settling district health board nurses’ pay claims, Health Minister Andrew Little said. “It’s encouraging that the discussions between NZNO and DHBs over the nurses’ employment ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Boost for Pacific regional business
    Pacific businesses will get a much-needed financial boost as they recover from the effects of the COVID-19 pandemic thanks to the new Pacific Aotearoa Regional Enterprise Fund, said Minister for Pacific Peoples Aupito William Sio.  The new $2 million fund will co-invest in Pacific business projects and initiatives to create ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • PM Ardern call with President Biden
    Prime Minister Jacinda Ardern spoke with US President Biden this morning, ahead of the APEC Informal Leaders’ Retreat on COVID-19. “President Biden and I discussed the forthcoming APEC leaders meeting and the critical importance of working together as a region to navigate out of the COVID-19 pandemic”, Jacinda Ardern said. ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Renewed partnership creates jobs for New Zealand youth
    The Government has signed a new memorandum of understanding (MoU) with the Mayors Taskforce for Jobs, strengthening the partnership to get more young people into work.  The Mayors Taskforce for Jobs (MTFJ) is a nationwide network of all Mayors in New Zealand, who are committed to making sure all young ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • South Island areas prioritised in tourism fund
    Five South Island areas are prioritised in the latest round of decisions from a tourism fund that is supporting infrastructure projects from Cape Reinga to Stewart Island and the Chathams. Tourism Minister Stuart Nash has announced details of 57 nationwide projects to receive support from the Tourism Infrastructure Fund (TIF). ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • New code sets clear expectations for learner safety and wellbeing in tertiary education
    A new code of practice for the pastoral care of domestic tertiary and international students will be in place from January next year, Education Minister Chris Hipkins announced today The code, which makes clear that creating an environment that supports learning and wellbeing is a shared responsibility between tertiary providers, ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • First TAB New Zealand Board appointments announced
    The members of the first TAB NZ Board come with experience in racing and sport administration, business and governance, the betting industry, broadcasting and gambling harm minimisation. “This Board will progress from the excellent work done by the interim board, put in place in August 2020,” Grant Robertson said. “The ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Northland Maori Pathways initiative introduced
    The Government has today launched Māori Pathways at Northland Region Corrections Facility, a ground-breaking series of initiatives designed in partnership with Māori to reduce re-offending and improve outcomes for whānau. A key part of the Hōkai Rangi strategy, Māori Pathways looks to achieve long-term change and involves a number of ...
    BeehiveBy beehive.govt.nz
    2 weeks ago
  • Extended Essential Skills visas being rolled out
    Two year Essential Skills visa to provide certainty to at least 18,000 visa holders Streamlined application process to benefit at least 57,000 visa holders The Government is increasing the duration of some Essential Skills visas and streamlining the application process to provide more certainty to employers and visa holders while ...
    BeehiveBy beehive.govt.nz
    2 weeks ago