Reaction to NZ power

Written By: - Date published: 7:09 am, April 20th, 2013 - 98 comments
Categories: capitalism, economy, energy, spin - Tags:

Of all the reaction to the Labour / Greens electricity proposals so far, this endorsement analysis has been by far the most significant:

Labour-Greens plan could work, says Vector CEO

The electricity policy announced by the Labour and Green parties could be made to work and the current debate is overly emotive, says the chief executive of the regulated monopoly electricity and gas network owner, Vector.

Overly emotive – do you suppose he’s referring to National’s nonsense about communists?

Simon Mackenzie told BusinessDesk he was encouraged by the fact the proposed central purchaser system would incentivise commercially rational investment in energy efficiency, and that the Opposition parties were not pursuing direct subsidies.

He also welcomed the fact Labour was proposing to simplify regulation of lines companies, which has become enmeshed in the courts after policies Labour implemented was “not tracking as was intended,” Mackenzie said.

There was “no perfect model” for electricity systems, and other countries used similar methods to set prices and to procure investment in new power plants as demand rises. At present, new generation is procured by competing generators identifying the “next least-cost” of new generation and deciding to build it. …

“There’s competition for providing that next plant,” said Mackenzie, who stressed he was “not taking political sides.”

“The model is used in other jurisdictions. It has its pros and cons. It’s made to work.”

Given the fact that the state purchaser model is working fine in other countries and in states of the USA, and given this analysis from one of NZ’s ultimate industry insiders, the Nats are going to have to come up with much more rational counterarguments than ranting about communists and the 1970s.

For an excellent roundup of other reactions see the amazingly thorough Bryce Edwards. Opinions in support:

The model is not only workable, writes No Right Turn, but is in use in Canada and the EU, specifically to reign in excess profits in systems where the market has failed to do so – see: Fixing the electricity market. And there’s some support for this view from experts and advocates. Energy analyst Simon Terry says single buyer models are common overseas, and they work – see RNZ’s Large power users reject single buyer plan. This view is shared by Victoria University’s Geoff Bertram: ‘It’s precisely the sort of thing you need to do to stop the relentless rise of power prices ahead of inflation’ and by both Consumer NZ and Grey Power – see TVNZ’s Labour and the Green’s electricity plan commended.

Opinions opposed consists of a fair bit of squealing business folk. Well they would, wouldn’t they. Because this policy isn’t for them. It’s for the roughly one quarter of Kiwi families that are living with fuel poverty due in part to the ever rising prices of the failed market model.

(Post updated at the request of Vector)

98 comments on “Reaction to NZ power ”

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  1. karol 1
    20 April 2013 at 7:49 am

    I am pleased that at Labour-Green government would use a policy like this to make life easier for those living in poverty. Fuel poverty is a major contributor to poverty. This policy will make a difference.

    The above quotes and links show how out of touch the NAct’s are, and how fearful they are of any little thing that would work against their agenda to increase the wealth of the few, at the expense of the many.

    However, what those links and quotes also indicate to me is, that this policy is not the game-changer that Trotter takes it to be. It may be a shift away from the free-market philosophy as superficially promoted by “neoliberalism”. But it does not signify a major shift towards a solidly left wing government.

    The neoliberal philosophy was always a nice-sounding front for policies aimed at halting shifts towards a more inclusive and fair society. In the 70s there had been a shift where there was less of a wealth gap, strong unions and relatively fair employment laws. The shift fronted by “neoliberal” PR, was to enable more opportunities for the wealthy to regain their advantage.

    The examples used above of where similar policies have been put into practice, show it to be a bit of a patch to prop up captialism where the market has failed. They don’t indicate a widespread shift towards a different economic and social arrangement.

    So, of course, someone like the Vector CEO is seeing how the policy with keep his enterprise going in difficult times. The policy will also do something practical, and relatively immediate to improve the lives of those struggling in poverty. However, it is something that will also be welcomed by the middle classes who are becoming very uneasy about the escalation of the amount of their power bills. In this aspect, I don’t see much of a shift away from the middle classes being the main focus of the NZ Labour caucus.

    In doing something for both middle and poorer classes, it’s a very smart policy. However, it does nothing to empower (sorry can’t think of a less punny term) … nothing to empower those on low income. It does little to change the capitalist structure that will always work against those on lower incomes. That would require major changes to industrial and employment laws, to local democracy (local councils), to social security, etc.

    The NZ Power policy does do something practical for those in fuel poverty, so, failing a more significant political shift it is to be welcomed. The policy also is likely to result in a much needed brake on the NAct plans for privatising the powercos – a major reason for NAct panic. I will not be getting into major celebration mode til I see something from the Lab-Greens that shows a more fundamental paradigm shift to a truly left wing government.

    • ghostrider888 1.1
      20 April 2013 at 11:50 am

      it is a shift to a “mixed economy model” in contrast to the neo-lib
      -Colin James

      • Alanz 1.1.1
        20 April 2013 at 12:04 pm

        You mean Colin James here:

        “The private and public spheres are not distinct. They mesh, overlap and often blend. Drought-stricken farmers needing public-sector handouts know that. Private-sector-loving United States lavished public money on big “private” firms during the GFC.

        “Solid Energy’s past and Mighty River’s future suggest a need to rethink the public-private relationship — not just on the cabinet side of politics but on the public-sector-loving Labour-Greens side. So far, neither side has really done that deep rethinking.”

        http://www.colinjames.co.nz/ODT/ODT_2013/ODT_13Mar19.htm

        • Colonial Viper 1.1.1.1
          20 April 2013 at 12:06 pm

          Labour doesn’t love the public sector. Dunno about the Greens, they’ve never demonstrated one way or the other in power.

        • ghostrider888 1.1.1.2
          20 April 2013 at 1:30 pm

          Share (and other) write-downs
          http://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=10878636

          btw, Colin James appears one of the most astute political commentators we have in the MSM imo

        • Anne 1.1.1.3
          20 April 2013 at 7:21 pm

          Solid Energy’s past and Mighty River’s future suggest a need to rethink the public-private relationship — not just on the cabinet side of politics but on the public-sector-loving Labour-Greens side. So far, neither side has really done that deep rethinking.

          The public/private partnership model forms the fundamental basis of David Shearer’s political beliefs.

          He came to an LEC meeting in my electorate about 2 yrs ago and that was the message that came through loud and clear. He was the shadow spokesperson for science and technology at the time and the examples of where he believed such a partnership would be invaluable lay in areas related to public/private power producing initiatives.

          I have to say his rhetoric on the subject was impressive, and I perceive this new entity NZ Power as an example of what he was talking about.

          I think this might be why NAct are so belligerent with their criticism. He and Norman have out-smarted them at their game.

          Btw, this is coming from a strong Cunliffe supporter. If Shearer had the nous to put Cunliffe back on the front bench where he belongs he (Shearer) would have my full support!

          • karol 1.1.1.3.1
            20 April 2013 at 7:32 pm

            Oh. Well, I think public-private partnerships need to be used with caution. I think they are usually one of the Blairite, Third Way politics, as indicated on Wikipedia..

            With what I saw from Shearer’s private army writings, your experience, Anne, is ringing alarm bells for me.

            • Anne 1.1.1.3.1.1
              20 April 2013 at 7:51 pm

              I’m merely reporting what I picked up from that meeting address karol. It sounded alright to me at the time – even impressive as I have said – but of course how it translates into practice is the key to its success. That is why I want to see Cunliffe there to counter-balance any tendency for it to become a Blairite or Keyite experience.

              • karol …
                20 April 2013 at 8:08 pm

                Well, the main problem with PPPs is that it often/usually privatises the gains and socialises the losses. I’m not sure that would be true of NZ Power.

                However, what would happen if the power generators were operating with minimal profits, while NZ Power was committed to low power prices for the consumers?

                • Anne …
                  20 April 2013 at 8:21 pm

                  I like to think Labour and the Greens would be selective in any PPP arrangement and would only sanction them if they were going to improve the quality of life for ordinary NZers.

                  That is the difference between NAct and Lab/Green. The former operates to the advantage of the rich and powerful while the latter lays claim to assisting the less well off and the disadvantaged. I’m willing to accept (at this stage) that a degree of PPP, provided it is in the control of left leaning parties could be appropriate for the times.

                  Who knows whether that will prove to be correct. We can only wait and see.

    • Colonial Viper 1.2
      20 April 2013 at 11:57 am

      I agree with you karol, but it is the gutsiest thing we’ve seen from Labour in 4 years. I like the Greens version of the policy still.

      Two more like this: one around rental properties, and one around the banks and banking debt, and I’ll buy a lifetime membership to Labour. If they’ll still have me 😈

      • karol 1.2.1
        20 April 2013 at 6:21 pm

        CV: Two more like this: one around rental properties, and one around the banks and banking debt
        Agree on these. But I’d also like to see something on unions and social security.

        I agree with Bomber, Lab-Greens need Mana to keep the left & community focus. And to stop NZ First pulling them to the left right.

    • Draco T Bastard 1.3
      20 April 2013 at 1:06 pm

      +1

      Well said. As you say, this PowerNZ policy does nothing to shift the current paradigm away from its corporatism.

      • karol 1.3.1
        20 April 2013 at 6:27 pm

        Exactly and the NZ Power policy is top-down. It promises to give something to those on low incomes. But what is given can be taken away.

        I think the NZ Power policy is very smart at this stage.

        But I also am wary because I have been disappointed before. Helen Clark promised closing the gaps, but pulled back from it early on. And then there was the whole foreshore and seabed debacle, and working for families that didn’t really help the least well off.

        In the UK, I celebrated when Thatcher’s Party removed her from leadership. But then came John Major, and Blair… and then Cameron.

        Now, I’m looking for a major a lasting paradigm shift.

        NAct is being so destructive that a possible change of government seems like a major relief…. for the short term, at least.

  2. lanthanide 2
    20 April 2013 at 8:01 am

    There was someone from business NZ on TV last night, whatever tv3s late night news spot is. They introduced business NZ as “usually the friends and supports of National”. He said it was about time someone was did something serious about prices and that lowering the wholesale cost would help exporters and manufacturers to stay in business and employ more people. So I guess he agrees with BERL?

    • Sosoo 2.1
      20 April 2013 at 9:55 am

      The point being that the business community isn’t as wedded to the ideological ravings of the far right as is assumed. A lecture from members of the Hayek cult is less motivation to many business owners than the horror of an extortionate power bill.

      • Colonial Viper 2.1.1
        20 April 2013 at 12:10 pm

        Plenty of small and medium businesses, independent contractors, and others, would love lower power prices. I think Labour/Greens get this, which is bloody fantastic.

        • David H. 2.1.1.1
          20 April 2013 at 1:08 pm

          It’s good to see at least some politicians agreeing that lower prices would be better for New Zealanders, and will curb the excess profits of [deleted] capitalism. It’s clear that National wouldn’t dare step out of line and disobey the instructions set by big business and [r0b: racist rant deleted] we can expect nothing from him that would benefit the little people.

          Labour/Greens will certainly have my vote!

  3. Saarbo 3
    20 April 2013 at 8:27 am

    http://www.stuff.co.nz/waikato-times/news/8574812/Town-paralysed-by-unexplained-power-outage

    Simon Bridges reckons that NZ Power will bring Blackouts….its already happening under the existing structure Simon.

    • Lanthanide 3.1
      20 April 2013 at 9:49 am

      He is talking about blackouts in the form of “not enough electricity being generated”. The example you have provided is more one of “physical infrastructure has failed” – there’s plenty of capacity, it just can’t reach those users.

      Of course he hasn’t made that clear, because of course making that distinction somewhat weakens his argument; on the flip side it leaves him open to the sort of attack you’ve just made.

      • ghostwhowalksnz 3.1.1
        20 April 2013 at 11:09 am

        The demand has been falling for a few years now. Generating capacity isnt a problem, even with the aluminum smelter still running. If it closes …..

        • Jackal 3.1.1.1
          20 April 2013 at 8:36 pm

          It’s only industrial electricity consumption that has been declining, causing an overall reduced consumption rate since 2007. There’s definitely more capacity available without the need for large power generating projects.

          Agricultural, commercial and residential consumption has continued to increase, and with industrial electricity being a lot cheaper, that decline has been more than compensated for by increases in other areas of consumption.

          That’s one of the reasons nearly every power company continues to increase their revenue streams… On average by 18.6% in 2012.

      • Draco T Bastard 3.1.2
        20 April 2013 at 1:11 pm

        It’s an example of necessary infrastructure not being properly maintained under the present system – exactly as what happened to Auckland. It is, quite simply, what happens when profit becomes the driver rather than supplying a needed community service.

  4. ak 4
    20 April 2013 at 8:38 am

    It’s reminiscent of the Helenhate campaign. Every single possible word and phrase of denigration and fearmongering from Adolf to Zimbabe, trotted out and repeated at every possible opportunity.

    Five bucks on Economic Terrorism by the end of today.

  5. Matt 5
    20 April 2013 at 8:41 am

    Fran O’Sullivan hates it so you know it has to be good. Coming soon, the Herald explains how NZ Power is just like something Pol Pot, Idi Amin or Himmler would come up with.*

    http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=10878594

    [edit] * tip of the hat to ak

    • North 5.1
      20 April 2013 at 9:08 am

      Yeah, Fran’s tossed Hugo Chavez into the pot as inspiration for these power announcements. Man it’s getting crowded in that pot !

      The whole bizo otherwise sneeringly characterised as a naked grab for political power. Oh Lordy she’s a faithful old chook !

      • Alanz 5.1.1
        20 April 2013 at 9:33 am

        Well done, Labour and Greens!

        The market has failed to deliver for the common household.

        I will swing behind this Labour/Green policy and give them a mandate to bring about the changes.

  6. burt 6
    20 April 2013 at 8:45 am

    So the CEO of a large regulated power company/network thinks it’s a great idea to have a single larger power company… Shit really… Who’d have thunk it.

    • tc 6.1
      20 April 2013 at 9:22 am

      He answers to Stassney so this is smart politics to keep any future new gov’t away from the bloated lines companies who are just as inefficient and top heavy as the generators.

      • burt 6.1.1
        20 April 2013 at 9:26 am

        In another surprise announcement the CEO of ACC supports fresh government policy for the establishment of a monopoly property insurance entity called NZ Insurance.

  8. cricklewood 8
    20 April 2013 at 9:28 am

    Maybe someone can help me understand something, there was a lot of talk about super profits that the generators were/are making.
    Apart from Contact energy I was under the impression that all the generation was govt owned? If I am correct in that surely that means that successive governments have been actively and gleefully taking ‘super profits’ from it’s citizens?
    Would I be wrong in saying that the govt which continually took super profits through demanding higher dividends actually drove us to the point where we are now with our power prices and actually made the companies look more attractive as a sale able proposition?
    I agree that that dropping power prices through these means is brilliant but I can’t help but think that if there was no threat of sale we would be hearing nothing about this and the rort would continue unabated and in that case I kinda feel it’s good that the Nat’s have forced Labours hand on this…Or maybe i’m just a big ol’ cynic…

    • burt 8.1
      20 April 2013 at 9:34 am

      You are correct. The stealth tax collection via electricity pricing is ongoing and disgraceful. The Labour Party are busily running around spending tax payers money telling us we already own the power companies so why would we want to buy shares in them while neglecting to tell us that billions of dollars of profits have been scooped from struggling families who have had zero control over power pricing. If we own them then why don’t we get a say in the level of profits they extract from us. Because they are the givernment and they do what the hell they like with an arrogance that says the business of government is whatever government say it is.

      To think that people might be stupid enough to give the self serving bastards more control and influence over our lives is frightening. People are optimists though, if we weren’t we wouldn’t get out of our state owned beds to go to our state owned jobs to earn money to buy the food we are allowed to buy from our state owned shops.

      • Foreign Waka 8.1.1
        21 April 2013 at 10:19 am

        Hi Burt
        The quintessential core to this is that the assets are owed by the taxpayer. Every shareholder company would put such undertaking as selling 49% to a vote. But it seems that democracy on one hand and corporatism on the other does not apply in this case. Which is interesting as the one thing that seems to fly out the window caused by greed on all sides is : the law of the land.

        I listened to The Nation this morning and Mr Peters has already the next ruse lined up : buying back what does not belong to him or his party with the “Cullen Fund” or “Kiwi Saver”. So by then the government has sold what does not belong to them (no individual Kiwi will see a dime) and new the shareholders are now being comforted that there is splash money to cover their risk! This is almost as good as a Mafia movie.

    • lprent 8.2
      20 April 2013 at 9:52 am

      Contact and Trustpower are both private. http://en.wikipedia.org/wiki/New_Zealand_electricity_market#Generation_companies

      Look at the timeline (timing is everything in these types of large scale infrastructure changes). http://en.wikipedia.org/wiki/New_Zealand_electricity_market#Milestones_in_the_reform_process

      Bradford and the other silly buggers in the previous National Government in the 90’s sold off Contract in 1998 and broke up the ECNZ just prior to the 1999 election. This made putting the egg back together to be somewhat fraught.

      The ministerial enquiry in 2000 essentially concluded that the dust would have to settle because any further changes would be dangerous to the stability of the grid. So after consultation they regulated.

      Yes the government has been taking dividends. They were pretty well required to if you read the legislation setting up the power companies in the 90’s because Bradford et al put it in there. It was effectively part of the basis that Contact Energy was sold under and that Trustpower was privatised under.

      Just consider that this government is intending to sell at least 49% of the other three major power generating companies in the next few years and they have the numbers to put this through the house.

      If there is going to be something done to fix broken electricity market that simply provides an incentive to keep pushing power prices up, then it has to be announced prior to the sale of those companies so investors know what their risks are. Labout and the Greens have done that.

      • ghostwhowalksnz 8.2.1
        20 April 2013 at 11:13 am

        Bradford effectively interfered in private property rights by breaking up the old local power companies.

        So when national interferes in the market to get’ lower power prices’ its a great thing !

    • MikeG 8.3
      20 April 2013 at 1:03 pm

      It’s worth noting that although the Contact Energy shares dropped significantly, they are only down to the level they were at approx. 3 months ago.

  9. felix 9
    20 April 2013 at 9:49 am

    National and their bleaters are being quite irresponsible with this.

    Yelling from the rooftops that the planned changes to the electricity system are Stalinist, Nth Korean, back to the 70s etc etc is only having the effect of frightening away potential investors.

    They’re sabotaging their own sale process. It’s economic vandalism.

    • Te Reo Putake 9.1
      20 April 2013 at 10:14 am

      And shifting some of the profits from power generation from the Gummint to the consumers is now Stalinist orthodoxy, not one of the founding principles of ACT as previously thought. Eurasia is at war with Eastasia, and always has been.

    • ghostrider888 9.2
      20 April 2013 at 4:30 pm

      that is clever felix

      • Colonial Viper 9.2.1
        20 April 2013 at 9:51 pm

        Damn that man is smart

        Shearer, why not supplement your PR team with these Standard denizens

  10. Dv 10
    20 April 2013 at 9:58 am

    >>Yelling from the rooftops that the planned changes to the electricity system are Stalinist, Nth Korean, back to the 70s etc etc is only having the effect of frightening away potential investors.

    They’re sabotaging their own sale process. It’s economic vandalism.

    Very Good point Felix

    • The Pink Postman 10.1
      20 April 2013 at 4:32 pm

      which only shows how scared the Tories are over this announcement Dv.
      They have forgotten that a similar system works for Fonterra and Pharmac.
      Crosby/Textor will be working overtime to discredit this policy . They will also be worried at
      the way Labour and the Greens are co-operating “A small win for Socialism but a big win for the NZ
      public ” Its also good too see that David Shearer is becoming an efficient leader .
      Another worry for Key and his ilk.

      • Colonial Viper 10.1.1
        20 April 2013 at 9:58 pm

        They have forgotten that a similar system works for Fonterra and Pharmac.

        Oh they’re very aware that it works, which is why they’re upset.

  11. Paul 11
    20 April 2013 at 9:58 am

    Fran O’Sullivan mentioned Venezuela in her article this morning.
    So now this policy has been connected to Venezuela, North Korea, Zimbabwe, Albania, Stalinist Russia…
    Any other offers from panicky right wingers?

    • Alanz 11.1
      20 April 2013 at 10:14 am

      At this rate, the dolt will run out of countries on this planet to try to terrorise, erm, terrify the public.

      • Colonial Viper 11.1.1
        20 April 2013 at 10:27 am

        Well at least its more accurate as Chavez nationalised the grid in 2007. By the way interesting article here on the proposal for workers councils within the state electricity corporation, a proposal which seems to have been more recently put on ice.

        http://venezuelanalysis.com/news/6554

        Interesting the paragraph at the end where it said supermarket chain workers demanded nationalisation of the supermarkets they worked in.

        And Chavez made it happen…but the Workers Council formed afterwards ran the place like a bunch of bosses anyway.

    • AmaKiwi 11.2
      20 April 2013 at 10:34 am

      “So now this policy has been connected to Venezuela, North Korea, Zimbabwe, Albania, Stalinist Russia… Any other offers from panicky right wingers?”

      They left out Islamic countries. What is the GCSB worth if it can’t uncover the connection between state owned power companies and Islamic “terrorism”?

    • Alanz 11.3
      20 April 2013 at 10:46 am

      For Frothy Fran, the title of the week going to her should be the one the Prime Minister came up with:

      “barking mad”.

  12. burt 12
    20 April 2013 at 10:13 am

    I must admit that there are some very exciting possibilities here. Once all that pesky competition malarkey has been eliminated there is potential to completely socialise power pricing. The very need for the administrative overheads of sending out power bills could be completely eliminated.

    Like ACC where risks are socialised enabling people to not consider their behaviours in terms of cost electricity bills could be linked to income or property values. Poorer families wouldn’t need to think about running heaters all your round. Appliances and goods such as heaters and electric cars could have a NZ Power levy attached to their purchase price and annual licensing to contribute in a uniform way to the cost of their usage.

    Never needing to think about how much power you are using would be fantastic, not considering the 15kw heater is still running when you go away for the weekend would be great. Imagine coming home to a warm house without even thinking about costs.

    There is much to be gained by giving the government complete control over power pricing and billing options. No bad can come from allowing more state owned monopolies to have control over things which we need in our daily lives.

    • North 12.1
      20 April 2013 at 10:27 am

      Either (1) You’re just being a silly duffer Burt, or (2) You’re gonna starve if that tongue stays firmly in your cheek.

    • Colonial Viper 12.2
      20 April 2013 at 10:31 am

      The very need for the administrative overheads of sending out power bills could be completely eliminated.

      I thought you were all for cost cutting and efficiency improvements.

      Now they are a bad thing?

      Like ACC where risks are socialised enabling people to not consider their behaviours in terms of cost

      Uh…you do know that’s stupid right? Because risk to life and limb is a far bigger motivator for normal people.

      • Matt 12.2.1
        20 April 2013 at 10:39 am

        If I recall correctly, Burt is the habitual motorcycle crasher (without a helmet, by the sound of it) who revels in soaking ACC even though (because?) he despises it. So yeah, he’s a real go-to guy for wise commentary.

      • burt 12.2.2
        20 April 2013 at 10:45 am

        Sure CV, no argument there. But let’s be honest here. If you and I earn the same and I love mountain biking while you love knitting – we pay the same ACC levies. Likewise if I liked my house at a cosy 22 degrees 24/7 and never left it while you were never home and had no heaters at all then socialising power pricing would be extra special for me.

        Apparently the ACC model is excellent in that the costs are socialised and people needed consider their behaviours in terms of financial risk… So tell me why this model of no self responsibility wouldn’t also be excellent for power pricing. 🙂

        If socialism is good because it spreads the costs of essential good and services removing us from the user pays Tory model then … Like the resistance to water meters we should protest against power meters – surely….

        • Colonial Viper 12.2.2.1
          20 April 2013 at 10:47 am

          I think people worry more about their broken necks from mountain biking than who will pay for the neuro consult.

          By the way someone mountain biking MIGHT use ACC more. Someone who leaves the lights on DEFINITELY uses more power.

        • ghostrider888 12.2.2.2
          20 April 2013 at 12:05 pm

          well, according to The Nation interview with Max Bradford he endorses greater implementation of smart meters; he also prefers wholesale price ups and downs to be available to the consumer. Then he dropped into tory partisan-ship with,
          -blaming the Labour govt moratorium on new thermal generation
          -(nature) the loss of cheap gas
          -and recommending greater competition (=greater profit dividends / bonuses)

    • Draco T Bastard 12.3
      20 April 2013 at 1:44 pm

      And burt conclusively proves that he’s an idiot.

      • burt 12.3.1
        21 April 2013 at 7:29 pm

        Draco

        I’m confused, do you think we should have water meters to ensure that households that use a lot of water pay more than households that use very little ?

        I know – I’m an idiot…. Hopefully one of your lefty dear leaders picks this idea up and I get to smirk quietly to myself when I see you campaigning for socialising power prices with power being paid for like water… As a levy based on real estate capital value…

  13. Dv 13
    20 April 2013 at 11:19 am

    Isn’t the NzPower proposal similar to Fontera?

  14. vto 14
    20 April 2013 at 11:29 am

    This is most excellent. The pure goodness that comes from allowing people and organisations the freedom to do exactly as they are entitled…. *sigh*….. the free market (drifting off to dreamy sleep)

  15. ghostrider888 15
    20 April 2013 at 12:14 pm

    some points from The Nation on NZPower
    -Goff conceded back when that lower dividends were an option

    Parker-dividends don’t just “disappear” from the economy.
    -nett cost to the crown $100M met by the 500-800M inflationary budget allowance.

    it is a Labour / Greens policy “alignment”

    There is a bill been put forward by Labour to halt thermal generation (Jenny) according to Gareth Hughes.

    it was able to be determined that despite support for the GCSB extension-of-powers that Winston is leaning more to the Left;
    -would buy back shares in privatized power companies (whether that would be played by Winston under a Nats offer of power is debatable)
    -would buy with Cullen Fund or Kiwisaver and repay over time
    -would establish a “single generator” policy
    -essentially a Nationalist platform

    • Colonial Viper 15.1
      20 April 2013 at 12:52 pm

      What we need is a nation building platform.

      • ghostrider888 15.1.1
        20 April 2013 at 1:36 pm

        yeah, not freakin’ patriotism though; we have been over the weaknesses of that approach over many cups of “tse”

      • weka 15.1.2
        20 April 2013 at 3:48 pm

        “What we need is a nation building platform.”

        And a resurgence of activism country-wide. Can’t leave it up to the politicians.

  16. georgecom 16
    20 April 2013 at 12:44 pm

    Predictably the NZH has stories, columns and letters today spluttering and foaming at the mouth how the Labour-Greens policy is ‘destroying wealth’ and ‘destroying markets’, is a throwback to state control and bureaucracy.

    Predictable, we knew this type of reaction would come forth. What is interesting is that the splutterings from the right contains nothing new. No new arguments, no alternative solutions to power prices. Nothng really.

    An ‘energy analyst’, Simon Terry reported in Fridays NZH, summed the situation up well:
    “the market had failed to discipline excess profits relative to capital invested…The irony is that by going for Privatisation the Government has crystallised the problem and narrowed the opportunity to do something about it.”

    By shifting wealth overseas or to the top 5% with its privatisation policy, the Nats have focused attention on higher power prices for the many and high profits for the few. The few are now indignant that their expected revenue stream is under threat. They have also reduced a future governments ability to solve the problem. The nats won’t lift a finger to solve the issue themselves but make it harder for the next centre-left government to do so.

  17. Observer Tokoroa 17
    20 April 2013 at 1:21 pm

    Anthony Robins

    Why is John Key calling 50% of the electorate of New Zealand “barking mad” when they have felt the cold of huge rises in the cost of Power? Unnecessary rises. He hates people who point things out to him – doesn’t he?

    As prime Minister he is supposed to govern for all New Zealanders not just the rich. Instead he is insulting them by calling them “barking mad”.

    As for his very good friend and colleague, linking 50% of our population to North Korean Communists, you get the feeling that they are both lying, uncaring, greedy, unsophisticated little men. They both react like spoilt children when anybody disagrees with them.

    It really pleases these two little men that numerous New Zealanders will not be able to afford adequate heating this coming Winter. And that is Bastardry. Isn’t it?

    • Draco T Bastard 17.1
      20 April 2013 at 1:50 pm

      And that is Bastardry. Isn’t it?

      Sociopathy or perhaps psychopathy.

    • Descendant Of Sssmith 17.2
      20 April 2013 at 2:41 pm

      This is a government that has always insulted it’s own and denigrated it’s own citizens.

      It’s just the number they are insulting that is growing.

      An info graphic showing who they have increasingly denigrated over their term might be interesting.

      Sole parents, all beneficiaries, media, half the population, ………….

      One of the National Party growth industries.

    • felix 17.3
      20 April 2013 at 3:47 pm

      “Why is John Key calling 50% of the electorate of New Zealand “barking mad” when they have felt the cold of huge rises in the cost of Power?”

      Because he’s a cunt, dear.

    • r0b 17.4
      20 April 2013 at 11:38 pm

      Hi Observer Tokoroa

      Key is calling us “barking mad” because that is what he usually does when faced with an idea that challenges his mindset and / or his power. It’s worked for him many times in the past, so now it’s pretty much force of habit.

      It may not work for him this time, or in the future.

      Cheers
      Anthony / r0b

  18. Lanthanide 18
    20 April 2013 at 2:46 pm

    Got my hair cut this morning. Overheard the conversation between the hairdresser and the client before me, talking about the power announcement by Labour and the Greens. Hairdresser thought it was a good idea and about time, and that she “was sick of National now” – gives me the impression she voted for Key at least once. Client agreed, because of the massive price rises in everything it was hard to get by these days.

    • Pete 18.1
      20 April 2013 at 2:58 pm

      It’s a very, very clever position to take. National’s victories have been based around winning the precariat. People who work, but resent those on social welfare and the university educated elites who got interest free loans. National has continued to capitalise on that resentment but hasn’t delivered anything for the people stuck in dead end jobs barely making ends meet. This is something concrete. This is something that makes life easier for people each month, even if it is only $30 or so. It’s going to win votes. I’m not sure it’s a game changer, but it is a step in the right direction.

      • Colonial Viper 18.1.1
        20 April 2013 at 9:46 pm

        It only takes 2 or 3 more similar sized steps, and Labour/Greens will trounce National by a country mile. 51% or 52% even 🙂

  19. Observer Tokoroa 19
    20 April 2013 at 7:09 pm

    Descendant of Sssmith

    An info graphic of whom the brazen brats both male and female, collectively called “National” have insulted would be a good thing.

    Key has pirated ideas from that colossal conservative failure Mitt Romney. who wrote off 47% of the people of America whom he was seeking to rule (I kid you not) , but whom were beneath his stunted dignity anyway. Key upped this percentage, and says 50% of New Zealanders are “Barking Mad” all because they want to STOP him ripping them off any more!

    His equally grubby mate, says half of New Zealanders are linked to North Korean Communists. The nasty lying ratbag. What a sick mind he has got!

    We have seen it all before way back, and set it to song :

    Sing a song of sixpence
    a pocket full of rye
    four and twenty Blackbirds baked in a pie

    The Key was in his Counting house
    counting out his money
    The Turia was in the parlour eating bread and honey

    The maid was in the garden – working – hanging out the clothes
    When down came a Conservative minister and pecked off her nose (again).

    taking from those who have less, is the punishing hallmark of wealthy conservatives

  20. karol 20
    20 April 2013 at 7:24 pm

    Oh dear. I haven’t seen this weekend’s The Nation yet (it’s on after I leave for work). But will try to give it a viewing tomorrow.

    Bomber’s review, says Parker has designed an excellent power policy, but he is not up to fronting on the media about it.

    Rachel is grilling Parker on their beautiful new electricity policy. The issue with Labour and Greens is what happens if we lose electricity dividends, Parker is doing a terrible job of selling this.

    And this is going to be the problem. Labour have great policy here and the main proponents out selling it can’t do that, this is why bloody Cunliffe has to be out selling this. Parker is a wonk, he’s an incredible mind, but he can’t sell the vision. Parker is getting pushed around by Rachel because Rachel has real questions that don’t really get answered by Parker.

    If Cunliffe was Finance spokesperson right now Labour would be able to throw down these bullshit criticisms. The worry is that the roar from the msm and the right will spook Labour, especially if they don’t have a champion out front able to sell it.

    Great policy, poor selling to date.

    And this up on a press release from The Nation:

    Labour Confused on Power Policy

    Labour Leader David Shearer and Finance Spokesman David Parker still appear to differ on whether power generator SOEs will pay a dividend under the party’s new electricity policy.

    Mr Shearer issued a media statement yesterday saying the party would forgo dividends.

    But today, speaking on TV3’s “The Nation, Mr Shearer said that meant “all” dividends.

    But Mr Parker said Labour thought a Labour Government would forgo dividends only during the start up period of establishing a state owned New Zealand Power monopoly wholesale power company.

    “We think the power companies should earn a profit and pay a dividend, we’re not saying that they should be driven to extinction,” he said.

    • Salsy 20.1
      20 April 2013 at 9:21 pm

      Arrghh, so painful – But Bomber is bang on. Nobody identifies with nerds. They do all the hard work.. but keep them in the dark room – they aren’t human enough. If Shearer is serious about being PM – Cunliffe is the safe voyage… Not Joyce, not English, not Key can touch him.

    • Foreign waka 20.2
      21 April 2013 at 7:07 pm

      I saw The Nation this morning and could not help but wonder whether the lady interviewer was either deliberately playing stupid or has a hidden agenda. Mr Parker tried several times to explain the difference between dividends and taxes and she still tried to side track the issue by “naively” implying that she cannot see where the money is coming from when dividends are lower. I am sure anyone watching this would have by now cottoned on that she is implying that taxes will go up so any savings to average Joe is nil and void. Mr Parker explained that nett lower return is a lot less as the money is going into circulation and coming back via taxes. She still did not “understand”…..I belief journalism is dead in NZ.

      • Paul 20.2.1
        21 April 2013 at 7:19 pm

        I agree.
        Journalism is ‘owned’ in New Zealand.
        In this specific case, TV3 is owned by MediaWorks which is owned by the Ironbridge Capital group.
        According to Wikipedia “Ironbridge Capital is an Australian equity firm which provides equity for Australian and New Zealand businesses. It invests in buyouts and expansions of medium to large sized businesses.”
        However, Rachel Smalley isn’t the problem, It is the owners of the media and the governments who deregulated the media industry so massive corporations could control and filter our news.

  21. ianmac 21
    20 April 2013 at 8:02 pm

    Looking ahead I wonder how National is going to counter the Electricity initiative. The Nats are unscrupulous and have a huge battery of experts to start a counter offensive. It will be bloody.

  22. Jimmie 22
    20 April 2013 at 8:33 pm

    Labour finance spokesman David Parker today said the plan was affordable despite the loss of dividends.

    Speaking on TV3’s The Nation this morning, he said the net cost of the plan to the Crown was less than $100 million.

    “It’s not like the money disappears from the economy, just that people have more money in their pockets. Instead of spending it on inflated power prices, they’re spending it somewhere else in the economy.”

    http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10878699

    Substitute the words “inflated power prices” for “income tax cuts” and don’t you have the antithesis of socialism where it is assumed that centralized $$$ is preferred to individuals being able to spend their own dollars?

    Did David Shearer & Russell Norman fall down Alice’s rabbit hole where left is right and the left is arguing strongly that the government should be forcing people to keep and spend more of their own money?

    So its fine for all the fat cats with mansions in Parnell to receive a far greater dose of subsidized power while Bob the bene will only receive diddly squat (notice that they talk about average price reductions – guess who will receive below average cuts?)

  23. Lanthanide 23
    20 April 2013 at 9:38 pm

    “Did David Shearer & Russell Norman fall down Alice’s rabbit hole where left is right and the left is arguing strongly that the government should be forcing people to keep and spend more of their own money?”

    No, because the left is (generally) against regressive taxes such as GST, and in favour of a progressive tax system and those that have more paying more tax, such as CGT and Labour’s proposed $5,000 tax free bracket.

    The power price changes signalled here are progressive: every household should see a $250-330 annual power savings, ranging from those on the lowest incomes, where it will make a big difference, to those on the highest incomes, where it won’t matter a jot.

  24. Matthew Hooton 24
    21 April 2013 at 9:50 am

    Big reversals everywhere.
    It wasn’t long ago that Labour/Green were wanting to increase the price of electricity through carbon charges/ETS etc.
    Reducing the price will fuel consumption won’t it? Which, if expensive new generation isn’t built, will mean more work for Huntly?
    Also, I don’t see how reducing the price is going to help EECA’s work, one of Jeanette Fitzsimons’ legacies.
    I guess global warming or climate change aren’t as fashionable right now, and obviously not polling as well as “lower prices”.

    • geoff 24.1
      21 April 2013 at 10:50 am

      Reducing the price will fuel consumption won’t it? Which, if expensive new generation isn’t built, will mean more work for Huntly?

      – Electricity demand is flat and has been for years.
      – We presently have an over supply of generation and if Tiwai shuts down we will be swimming in power.
      – The annual household usage of electricity has been incredibly stable for the last 30 years (~8000kWh/yr) so it is implausible to suggest that lowering prices will cause a significant increase in consumption. I actually hope there will be some increase as families who have been depriving themselves of warmth due to poverty will be able to heat their homes a bit more.

      You’re correct on one count though, Matthew. It is more difficult to get the general public involved in climate change issues when they are drowning in debt, unemployment and sky-high prices of basic necessities. All of which are a direct consequence of economic policies that you advocate.

    • Foreign waka 24.2
      21 April 2013 at 7:14 pm

      When you are hungry and don’t know where the next meal is coming from and a heater becomes a luxury – no one will give a toss about the environment. You need to look up the basic need pyramid.
      Not to be mistaken with greed that has the effect of displaying the same attitude.

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