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The solar surcharge

Written By: - Date published: 2:39 pm, April 15th, 2016 - 98 comments
Categories: energy, infrastructure, sustainability, uncategorized - Tags: , , , , ,

Not knowing anything about the electricity industry, this looks like a difficult topic to me:

Another lines company ponders solar charge

Lines company Eastland Group is considering following the example of the Hawke’s Bay lines company Unison and imposing an extra lines charge on people using solar panels. But a final decision has not been made and can not happen for another year.

Two weeks ago, Unison put an extra tariff on people installing solar panels to offset its losses from getting lower lines payments from these households.

It said the cost of maintaining the line remained the same and without an extra charge, people without solar panels would subsidise those who have them. … “We don’t want people who can afford to put solar on the roofs of their houses to be getting a subsidy from those that do not have solar,” Mr Todd said.

The electric lines industry has said many times that people using solar panels and batteries pay lower power bills, making less money available to pay for the electricity grid. Yet most solar panel users still need that grid to be available as a fallback when solar power dries up overnight or on cloudy days.

We should be encouraging solar systems as they reduce carbon emissions – go renewable energy! But here we are reducing (eliminating?) the cost savings, sending exactly the wrong price signals.

On the other hand the argument that the grid still needs to be there and and be maintained is valid. Should this be a communal resource that everyone contributes to equally or should those with solar be subsidised by those without? (Is the subsidy argument valid, or is this just profit gouging from lines companies?)

There are 28 lines companies in New Zealand all facing falling revenue and static fixed costs.

I’m willing to bet that’s a big part of the problem.

I’m puzzled on this one, interested in your thoughts….

98 comments on “The solar surcharge”

  1. Henry Filth 1

    You rather have to wonder at why the charges aren’t paid by the generators who push their filthy electrons through the wires, rather than the users who pull the same filthy electrons through the wires.

    Now, can anyone point me at an analysis of lines company profitability, or shall I have to do it myself?

  2. Don't worry. Be happy 2

    Does it then become a legal norm to charge you for something that you do not purchase? what if say, you cut your power use through switching off rather than putting a solar panel up, can you be charged for the power you used to use but now do not?

    • Draco T Bastard 2.1

      That would be the logic of the lines companies here, yes.

    • RedLogix 2.2

      Even if you purchase net zero power, or even export a surplus, it is still reasonable to for the line company to charge for their provision of the lines. After all there is a fixed cost to providing them.

      However the real question is why line companies are privately held entities at all.

      • Macro 2.2.1

        “However the real question is why line companies are privately held entities at all.”

        Exactly – we sold off our National Power with the privatization of our service industries including our power generation.
        During the second world war the allies expended millions and thousands of lives trying to reduce Germany’s National Power.
        We can no longer control our destiny unless we wrest it back from the usurpers.

      • Lulu 2.2.2

        Most of New Zealand’s electricity networks businesses are owned or part-owned by community-based organisations of various types, called energy trusts.. In some cases such as Vector they are part owned by a community trust and partially privately owned.

    • b waghorn 2.3

      In the king country the much loved lines company charges lines to unoccupied house at about $1200 a year, they also did it to the dog trail clubs even though they only use power for 3 or 4 days a year.

      The much loved bit was sarc btw

  3. Zen Daldy 3

    I don’t see how this is legal.

    I thought the daily charge which everyone pays should cover the requirements for maintenance of the network?

    What is to stop Vodafone and Spark from charging a Skype tariff to anyone using the internet?

    In fact I am sure my car mechanic would love to charge me a tyre tariff due to my ability to source new tyres from other suppliers.

    Perhaps it is time for Fonterra and supermarkets to crack down on soy milk drinkers by ensuring they pay a non-milk drinking tariff. It would be the right thing to do for their shareholders.

    • TC 3.1

      Lines companies get it both ways, the line charges and a set rate/kwH on throughput from retailers…kaching every month.

      Their biggest challenge is blowing it all on multiple SAP systems and way too much management whilst they screw the maintenance providers.

    • ianmac 3.2

      Good points Zen.

    • Draco T Bastard 3.3


  4. TC 4

    another example of the blatant profiteering going on under national in the power sector.

    Invest in reducing your reliance on rising cost of power and get penalised so its another incentive NOT to install solar.

    The bastards only give you a fraction per kw/h for grid export than the rate for grid consumption which the retailer charges full whack for.

    Solar generators are actually aiding power companies making money with this margin so this extra charge is fn insulting !

    • Lulu 4.1

      Not really TC. At the next rate reset (as per Part 4 of the Commerce Act) these companies would put up everyone else’s charges to compensate for a decline in revenue by consumers importing less from the network. If the lines company didn’t put up charges the other 100,000 customers on the network would be subsidizing the few who can afford to pay $10,000 to put solar on their roofs.

  5. ianmac 5

    Solar panels face lack of Government interest because NZ produces about 80% power from renewable sources.
    Electrical supply companies must reward Shareholders.
    “Low user” customers pay small line charges. (About $10-12 per month.)
    A standard solar panel setup might take 10+ years to pay off the outlay.
    Currently back-up batteries are very/too expensive. (Aluminium storage might bring much cheaper storage in the future.)
    Surely the more solar energy is produced, the lower the pressure on upgrading maintaining the Lines. So Solar should be encouraged to save money.
    The technology is there to turn windows, roads, and buildings into solar energy providers.

    One plan from the Electricity suppliers is to drop Line charges altogether and have every house pay on the Council Rates instead of playing the Unison trick.

  6. Draco T Bastard 6

    The cost to maintain and expand the lines is a fixed cost thus the fix to this issue that the lines companies have invented is to charge each household the exact same amount for connection to the grid. This gets rid of the illusory subsidy that people installing solar panels are getting.

    The variable rate would then be solely upon the amount of power each household uses. Households with solar panels installed and generating power would be paid the wholesale rate at the time – same as all the other generators.

    It’s not actually hard.

    The question that needs to be asked is: How many the generating companies also happen to own lines companies?

    Because it’s going to be the generating companies that will lose revenue.

    Of course, what we’re seeing here is all the reasons why we started with a government monopoly on power generation and reticulation. An ‘electricity market’ simply doesn’t work because it’s a bloody monopoly.

    • ianmac 6.1

      “An ‘electricity market’ simply doesn’t work because it’s a bloody monopoly.”
      The Government makes much ado about the “power to shop around providers.” Huh! It is an illusion as the costs are so complicated that the few dollars you save by switching may be cancelled out by other hidden costs.

    • Well, it is for now. As home renewable solutions become more economical, goodbye monopoly.

      • Draco T Bastard 6.2.1

        Nope as we’ll still need the grid and that will always be a monopoly. Same way that roads and telecommunications infrastructure is a monopoly and always will be.

        • Macro

          Have you seen this
          Opens up even more possibilities. I can see it fitting in perfectly where I live.

        • If you’re generating sufficient power reserves from solar to get through extended stormy periods on home batteries, you don’t need the grid. Especially as home micro-turbines are also beginning to become practical, which essentially would mean you’d only need to run on batteries during calm nights, or calm, cloudy days.

          Now for most people that’s not the reality yet. Hence why we CURRENTLY need the grid. But if we can make batteries smaller and cheaper, and reduce the install cost and increase the generation of home generators, disconnecting from the grid could be a reality for people who aren’t extremely frugal with electricity.

          • Draco T Bastard

            The grid allows smart generation and distribution of renewable electricity. The sun may not shine in one place all the time but it’s shining somewhere. Or the wind is blowing.

            It also removes the need for batteries thus reducing the environmental damage done by producing them and then the costs of having to recycle them.

            Putting batteries in every home is impractical and uneconomic. It uses more resources than necessary to produce the same result.

            • weka

              I agree that batteries are hugely problematic. Hydro has its own storage system that causes environmental damage. Any conversation about power, climate change and the environment has to include discussion on reducing power consumption (and probably a steady state economy).

            • Matthew Whitehead

              Oh, for mass use, I agree it’s not hugely efficient. But the ability to go full home-generation means that you can ditch the electric bill without ditching electricity, so it will affect the effectiveness of monopoly powers for electricity companies without the government even taking action.

              That said, as Marco is alluding to elsewhere, advances in storage technology are better applied to the grid itself in combination with sustainable generation techniques.

          • Macro

            Matthew – have a look at the link I referred to Draco above.

            A taster:

            GE Global Research is testing a desk-size turbine that could power a small town of about 10,000 homes. The unit is driven by “supercritical carbon dioxide,” which is in a state that at very high pressure and up to 700 °C exists as neither a liquid nor a gas. After the carbon dioxide passes through the turbine, it’s cooled and then repressurized before returning for another pass.

            The unit’s compact size and ability to turn on and off rapidly could make it useful in grid storage. It’s about one-tenth the size of a steam turbine of comparable output, and has the potential to be 50 percent efficient at turning heat into electricity.

            • Draco T Bastard

              After the carbon dioxide passes through the turbine, it’s cooled and then repressurized before returning for another pass.

              How big is the radiator and what’s it in?

              We already know that Huntly and other thermal generators cause difficulty in rivers because of thermal increase.

    • instrider 6.3

      Generators are barred by law from owning lines companies

  7. Heather Grimwood 7

    The rationale of the above lines’ companies is exactly that shown through my TrustPower account, where I choosing to stay on copper rather than pay for more expensive fibre, now find a punitive addition because of foregoing the latter. I notice the obscene profits made, presumably no-one benefitting from them having a clue of what it is like to live on a fixed income ( in the sense we use that term).

    • ianmac 7.1

      A sort of saying, “Friends you can have anything you like. You choose. But choose wrongly and we will make you pay! So you choose peasants!”
      Not fair Heather.

      • Heather Grimwood 7.1.1

        to ianmac…….immoral rather than not fair. AND APOLOGIES……SPARK WAS THE MISCREANT!, but the method used to ensure profit is the same.

  8. Bill 8

    The line charge is a constant, no? A few cents per day per customer from memory. What customers then use or don’t use in terms of electricity is irrelevant to the cost of maintenance. Or have I overlooked something?

    I’d say it’s companies trying to bring the big floppy boot down on any threat to their income stream.

    • ianmac 8.1

      The Line charges in our town are $1.99 per day. If you used no power at all you would pay $61 per month.

      • By comparison, they will pay you between 40c-70c per month for solar buyback for most companies, or maybe about $6.51 for companies that don’t limit buyback amounts if you have a large residential system and run constant surpluses.

        So you’d usually be out $60.00 just for the privilege of having a backup connection to the lines, which is outrageous. Better to install a system with enough batteries and generation to go completely off-grid (assuming you can given light levels and financial constraints…) if you live in an area charging lines fees.

      • Draco T Bastard 8.1.2

        That seems really bloody expensive. Just looking at the household bill now and, if I’m reading this bill right, we paid $11.93 for the month in line charges.

        • ianmac

          Sorry. A day late. Confirm 199cents per day Line charges. However I have just switched to a Low User account which charges 33cents per day or $10.23 per month, as long as I stay below average of 22 kw per day.

      • Bill 8.1.3

        $61 per month is more than my average monthly total for electricity. I’m currently spending less than $2 per day on electric, inclusive of line charges and levies and what not. You sure you read that right?

        • Macro

          Yep I would say ianmac, like me, probably lives away from a large town and the main grid net work. As a typical 1%er (wtf am I doing on here? ) I pay 3 different power bills around the country – one for a bach on the Coromandel coast – that bill is regularly around $64 almost all of that – line charges.

    • Lanthanide 8.2

      Depends on the lines company.

      I’m with Flick Electric, and they give a clear breakdown of all of the prices involved and how much is paid to whom.

      In Christchurch, my current bill shows me that the only lines component is charged per kilowatt hour (weirdly on my last bill there are two different rates for this – they may have just put their prices up I think?). In winter there will also be a 15c per day fixed charge, but that doesn’t apply just yet.

  9. Once Was Tim 9

    None of it would have become an issue had the natural monopoly of the grid (local) remained in public ownership – such as with councils, regional power boards or other entity where profit and a return to private shareholders is the primary motive.

    Now watch the neo-libs fuck up water reticulation.

    It’s hard to feel any sympathy for the power companies.

    • Especially given they’re probably overcharging us as-is, making it even more economical for people to go solar.

    • Gristle 9.2

      I have looked up all the distribution companies from Christchurch to the Bluff. All of them are effectively owned by either community trusts or the council (except Otago Net which is owned by PowerNet which is community trust owned.)

      These are a thorn in the side to Max Bradford and Treasury as they defy Neo lib economic rationalism. The local communities told the Government to go and shove it.

      And yet you are not recognising them as being locally community owned and controlled.

      Has anybody looked to see if Unison and Eastland are community owned?

      • Once Was Tim 9.2.1

        @ GRistle. You should check out Eastland’s Annual Report!. Full of bizz-speak: returns to shareholders; (I’m surprised at a cursory glance I didn’t see the word ‘stakeholder’ going forward); an obvious agenda towards the profit motive; no mention of a public or of a public service; etc. They are running a bizzzniss under the guise of a supposed-community interest. Christ – they probably even sponsor a bloody rescue helicopter or something – just to show how wonderfully concerned they are!

        This is a supposed ‘trust’ which is involved in all sorts of activities but one that doesn’t hold the principle of public service as its priority, especially in the nature of basic societal necessities: Shit pipes; water; electricity reticulation; transport; housing for the indigent; rubbish collection/recycling; etc.

        I was thinking more of ownership in public hands, and in a manner of accountability (even if only by way of elected representatives that could be dumped every three years), and all that before the neo-liberal bullshit we were spoon fed – such as that our government departments, councils et al must be run as businesses (with a profit motive, and a cast of thousands of ticket clippers, consultants and bullshit artists).
        E.g. Municipal Electricity departments of Power Boards with elected people who’d stand or fall on their competence, and without unrealistic salaries and non-performance bonuses – usually awarded regardless.
        Pre Douglas, pre the neo-lib revolution which seems to have infected everything from government departments (with all that so-called revolutionary accounting mechanism, corporatism, etc), to councils, to even so-called “co-operatives” such as Fonterrra. PRE all that kaka.

      • RedBaronCV 9.2.2

        Power lines around Wellington are owned by an offshore owner – china /hongkong

        • instrider

          Previously they were owned by that nice community owned company vector and they ripped Wellingtonians off to cross subsidise Auckland consumers. Commerce commission had to take them to court. So community owned companies are not always cuddly

    • Lulu 9.3

      Unison and Eastland aren’t power companies. They do not buy or sell electricity. They provide a transport service. The bulk of lines companies (e.g. Unison and Eastland) are owned or partially owned by community trusts.

  10. Richard Christie 10

    It said the cost of maintaining the line remained the same and without an extra charge, people without solar panels would subsidise those who have them. … “We don’t want people who can afford to put solar on the roofs of their houses to be getting a subsidy from those that do not have solar,” Mr Todd said.

    The electric lines industry has said many times that people using solar panels and batteries pay lower power bills, making less money available to pay for the electricity grid. Yet most solar panel users still need that grid to be available as a fallback when solar power dries up overnight or on cloudy days.

    The argument presented above for increasing charges seems to be based upon line companies charging for gross electricity bought and sold by the householder to the grid.

    A reduction of revenue based upon throughput only applies to PV households using battery storage, but the surcharge seems to indicate that it also hits those who install PV without battery storage .

    Lines company is providing a service for both the purchase of power from the household and sale to the household power. For non storage PV households using the same as always the situation should be fiscally neutral, or, if the PV household sold more than it purchased then the lines company would increase its revenue from such households if their charge is based upon throughput.

    That said, if they merely provide and maintain the ‘pipe’, why the hell should they be concerned with what goes down it and in what direction it flows?

    Perhaps they should consider a standard connection fee not based upon usage. Either you are on the grid or off the grid and use of the line is a fixed cost.

    • Draco T Bastard 10.1


      The grid should be a national fixed cost. that fixed cost would include the R&D to make it a better grid. What it shouldn’t include is profits to bludging shareholders.


    • Gristle 10.2

      Metering for Networks often occurs at the grid exit point. They do not get to see what happens at each tap of point. The consumer/ICP data is almost invisible to lines companies. Smart Meters are being installed (please no debate about the rights or wrongs of those meters). AMS owns around 80% of the meters in NZ and sells the information to Retailers. AMS is owned by Vector. IMO Access to ICP information from a dominant supplier will become the next sticking point in electricity supply in NZ.

      Back to metering at the GXP. Since the lines company sees only Millions or trillions of electricity entering its network it cannot recognise the handful of units that an individual PV grid tie installation produces.

      Unless you want outages networks are not designed to handle average demand. They are designed to handle peaks. So if PV users swing onto a network because the sun has gone down, or it’s been 3 days of fog, you can argue that the PV users are the cause of the peak demand. Usually peak demand users of things like airplanes, advertising, toll roads, New Apple phones etc have to pay a premium. With lines companies they are not asking to have peak charging and earning a premium (that is what the retailers do.)

      Networks are saying that if you want them to be here to connect you to a source of power then they have fixed costs to do that. So they cannot have a variable revenue mechanism to cover their fixed costs unless that variable rate greatly increases. And my guess is that it is cheaper for all to look at fixed costs route.

      Some locations like Wanaka or Taupo have a massive influx during summer holidays. It has been recorded that holiday makers swell the population to 5 times the normal size. So if you are creator of peak time then it would be possible to have a sliding scale of fixed user charges such as is present with low user tariffs.

  11. tc 11

    The entire system needs to be brought back under public control in my view.

    We will never leverage the natural advantage we have with our large renewables generation if we continue with the rentier model rather than operate an effective system.

    Took over 15 years to get diversity of supply into the akl CBD after the 97 blackout.

    It’s clearly not serving our best interests in its current form.

    • instrider 11.1

      The Auckland cbd failure was a failure by the publicly owned Mercury Energy to maintain its network and the failure of public ownership to incentivise proper investment in maintenance, and a failure by mercury’s management to recognise the.risks and deal with them.

      It had nothing to do with privatisation in any way, shape or form.

  12. weka 12

    All this sounds like a bloody good rationale for renationalising power in NZ. If companies can’t manage their businesses financially in a world of climate change then too bad for them. The priorities for the grid should be resilient power supply to NZ household, business, industry and essential services, along with affordability. If the current model can’t provide that in a post-carbon world, then we need a new model.

    • Macro 12.1

      We need to renationalise regardless in my opinion. It was nonsensical to sell them off in the first place.
      To tackle climate change all our resources must be used as efficiently as possible. The BS of “market forces” and “hidden hands” simple does not wash. It never did in war time and we are facing a war situation wrt climate change.

      By the way, have you seen this

      A federal judge in Oregon on Friday ruled that the lawsuit brought against the U.S. government by a group of youths last August can go to trial—a huge victory for the case climate activists are calling “the most important lawsuit on the planet right now.”

      The lawsuit, filed by 21 plaintiffs ages 8-19, and climate scientist Dr. James Hansen, states that the federal government is violating their right to life, liberty, and property, as well as their right to public trust resources, by enabling continued fossil fuel extraction and use.

      “This is as important a court case as the planet has yet seen,” said Bill McKibben, co-founder of climate group 350.org. “To watch the next generation stand up for every generation that will follow is as moving as it is significant.”

  13. Gristle 13

    If a lot of people go for grid tied pv systems then expect the distribution costs (the local lines company that is) to go up.
    1. All distribution systems are currently designed as spoke and hub systems. Power is pushed from the centre going out. Pushing back the other way causes the voltage level to rise. In Sydney this has been monitored at 270V and above. This is above the operating limits and will cause electrical equipment to fail. This can be designed around by the lines companies but it will take money.
    2. All the pv inverters will produce harmonics. Harmonics are cumulative across a network. These cause electrical equipment to fail. This can be designed around by lines companies, but it will take money.

    The current development stage of most distribution networks are such that an engineer from the 1970s could still function very well. A distribution network that is adapting automatically to change Low Voltage levels and counter harmonics, and manage electric vehicle demands is a way off. A large swag of investment is required to get there as well as a whole lot of new skills.

    In the meantime, if you want pv and to be grid tied then expect to pay for it. Not paying for access unless you want it pushes the costs onto everybody else. And guess what- the lowest earning people in NZ will be the last to PV . Effectively you are saying that the more wealthy people in NZ should be subsidised by the least wealthy!

    • Macro 13.1

      Or – if the grid and the generation was all owned by the people…
      Then everyone would pay for the redevelopment that will be necessary. Those at the lower end of the economic stream could be given subsidies to help them move to PV or have it installed by the state as a matter of course. Indeed all homes from here on in should be required to have 5KV as a minimum installed and solar water heating.
      I gather you are in Aus from your comment re Sydney – you over the ditch are far more advanced in solar than NZ for we have relied on our substantial Hydo resource. We also have the advantage of a very good wind resource and if we could harness it a huge energy supply in the Cook Strait. Never the less solar has also substantial benefits that can added to all of the above, and we have to keep fossil fuels in the ground.

      • Gristle 13.1.1

        According to the media I am in the Deep South. So no, you can rule out Australia.

        Don’t get to tied up about PV around here as a primary power source. The amount of energy delivered by the sun to my area is about 2/5 that which the sun delivers to Brisbane. So we are starting with a fair sized handicap in NZ.

        And then…..NZ is a winter peaking county for electricity. The demand for electricity is greatest in winter. Which just happens to coincide with shorter sunlight hours and the sun being lower in the sky. Go to California and it is a summer peaking area.

        Play to your strengths and don’t follow others because it looks good.

    • Katipo 13.2

      Over voltages and harmonies can be mitigated, in fact there is a benefit of generating power closer to where it is being consumed in that it can help reduce the current in the transmission lines from distant power stations.
      If technology keeps tracking the way it is there could be a time in the future where there is no need for any domestic household to be connected to the grid.
      We could make a lot more sensible decisions for the country if the lines companies were all publicly owned. The costs could be more fairly shared among all of us who benefit from the grid and if a time came when a line becomes unnecessary you wouldn’t have the situation like we have now with the owners trying to protect and extract profit out of their lines even if goes against every engineering, environmental or ecconomic reason to do so.

      • Gristle 13.2.1

        It will take further investment in the local network to overcome voltage swell and THD. And that requires more a sophisticated and a more expensive network. Banda Bing, charges go up.

        Many of the lines companies are already owned by the local consumers. So sensible decisions can be made by lines companies.

        It’s the generators that have been privatised. It’s the generators who have led out with inflated costs. The used to justify the price of hydro dam generation on the basis of what it would cost if the electricity had been generated by an expensive thermal plant. The marginal cost of generation equated to something closely approaching zero but hits the bill at $0.14 per kWh. The generators then revalued the assets on the basis of the revenue earning potential. Next step was to go to the Commerce Commission EA and say we need to make x% return on our assets.
        And that was all under Cullen’s watch. The National Government just privatised it and locked in the profit making capability.

  14. Sandie 14

    I am already paying a fee for producing solar power called an export charge also in summer we get 5c per unit and 10 c per unit in winter and look what they sell it to the consumer for. There is no incentive to have solar panels. What about the frugal power user. Is he penalised for using so much less. I think not. Most of us borrow good money to have solar power and we are penalised for this. big multi corporate companies dont give a shit about the consumer. Yet we have adverts on TV about power saving. What a joke. Suggest we as consumers should look at profits and salaries paid to top brass of these companies. That is where consumer money goes. This year I have always had to pay power companies each monthIts just that its a bit less than everybody else. I have 3 kw of panels but power companies have seen to it I still pay

  15. RJM 15

    The cost of transmission and distribution in New Zealand is a fixed cost that can only rise as more parts of NZ are connected to it, as more connections occur, and as connections that require smarter technology and increased load become the norm. The cost of generation is variable. Currently the cost of transmission and distribution is paid for as a proportion of the per unit cost of electricity. The local network costs are included in the standing charge but the larger network’s costs are covered through an impost on the unit price. This means that people installing solar units and reducing their own networked consumption – and their contribution to the costs of the larger network – are relying on the rest of us to support the costs of the infrastructure. Consequently we either work out a new way of charging all NZers for these fixed costs or we charge personal solar generators extra for the network.

    • Ad 15.1

      You hit that one on the head RJM.

      The post itself admits that an electricity network cannot be sustained as a network unless the great majority of people opt in, rather than out, of paying for the network.

      The optimum I think is to reduce your own consumption (e.g. with solar hot water), while retaining connection to the grid. Solar hot water is the best of both worlds, because the consumer retains the security of paying for drawing on the grid, outlaying some capital without going into tens of thousands that takes many years to make worthwhile, and doing your bit to smooth the generators’ peaks and troughs.

      Selling from domestic generation does not need to be encouraged. Domestic generators should find their own equilibrium rather than require everyone else to balance for them.

      • Katipo 15.1.1

        Hmmmm but what if encouraging grid-connected domestic generatation meant we could reduce or eliminate all our current fossil fueled generation and help speed up the transition away from fossil fuels transport? Seems like the current “equilibrium” is just maintaining the status quo.

        • Ad

          The thing that really buniches my undies is the Electricity Commission, whose task it is to regulate these charges so that profit is only reasonable enough to sustain the network, don’t appear to have run the ruler over this charging at all.

          To your point, if the bourgeoisie within any core network opt out (because they have the capital to do so), its always the poor that lose out.

          • Lulu

            The Electricity Commission was the market regulator and has been replaced by the Electricity Authority which is quite a different organisation. The economic regulator is the Commerce Commission . ComCom regulate returns for monopoly businesses (including lines companies and the grid owner Transpower) under Part 4 of the Commerce Act. It is a painstaking and public process. .

    • NZJester 15.2

      To me it sounds like double dipping as the power feed back into the grid is on-sold at a profit and with the money for its transmission already paid for by those receiving it. How can you charge twice for the single transport of power over the lines from one location to another?

      • Lulu 15.2.1

        The transmission cost and lines cost are passed through via retail tariffs at cost. That cost includes a regulated return for the grid owner and lines companies. The energy component includes a margin on the energy – that is if competition hasn’t completely squeezed that out by now.

  16. gsays 16

    about 12 years ago we relocated a whare and decided to go off-grid.
    the main reason was max bradford and the deregulations.

    back then an 80 watt solar panel was around $1000.
    way cheaper now.

    a couple of observations:
    “The electric lines industry has said many times that people using solar panels and batteries pay lower power bills, ”

    i might be missing something, but, if you have batteries, you don’t have grid/power bill,

    this is all about profit, and a deceitful wedge with the comment of
    ” We don’t want people who can afford to put solar on the roofs of their houses to be getting a subsidy from those that do not have solar”
    one of the reasons for the move to put solar up is the price people are charged by the likes of unison and eastland group.

    and.. no moving parts.
    solar is great, wash the panels each year or so and you are good to go, don’t bother with the wind.

    • Gristle 16.1

      A house in NZ typically has a 63A supply which at 230V gives a maximum load of 15kW. Do you see the difference between 15kW and say and PV installation of 3kW. A lines company will plan and design supply systems to let you take that 15kW of power and use it simultaneously to have the stove on, heat water, run he septic tank, watch television, run the computer and in the future maybe charge your EV. Try doing that on a 3kW PV system that operates at maximum for 6 hours per day at 80% efficiency.

      The last house I recommended to set up off grid was because they were facing a bill of $70k to get power into the farm. It made sense there.

      Batteries need to be replaced over time as they fail. A decent battery bank will cost you about $10k every 10 years. All those Tesla type batteries use rare earth metals and have a huge carbon foot print to make.

      Battery technology is coming along and if I was forced to buy one myself right now then I would go for a Vanadium Redox Battery. But then I would want to wait 10 years before committing.

      • gsays 16.1.1

        hi gristle,
        we are running a house on just under 2kw.
        septic is gravity feed, just like they were for centuries (power to pump pooh, please!), we have most the mod cons and heat water/house with solid fuel.

        i agree about batteries, no battery bank dies, they are murdered.
        we are onto our second bank but are caring for it, regular overcharging etc.

        • Draco T Bastard

          i agree about batteries, no battery bank dies, they are murdered.

          Pretty much.

          When I bought my cellphone off of Trademe the person I bought it off sent me two batteries. One was marked old and he said that it was fucked but could hold a couple of hours of charge when needed.

          Took me three days of careful charge/discharge to get it back manufacturer stats.

          People just don’t seem to know how to treat batteries any more.

      • Draco T Bastard 16.1.2

        If you’re going to wait ten years before going for a battery then you’ll want to go aluminium.

        Looking at the stats, I wouldn’t touch a vanadium redox battery. The charge density is far too low.

        Still, I’m of the opinion that we should even be thinking of using batteries in the house. Upgrading the grid is the far better option.

        • Gristle

          I agree about Al, but what I said was that if I had to by a battery now it would be Vanadium. Density is not an issue for me. Have farm, and room enough to put a acres of them.

    • Macro 17.1

      Thanks – very interesting link.
      Why we need to take back our Grid!

      • b waghorn 17.1.1

        I would assume every part of the countries tax built the grid, and given that 30% of voters live north of the bombays and winnys the king of the north , it should be an easy one to beat.

  17. Jenny 18

    Privatisation comes back to bite us in surprising ways.

    If the public grid was being owned and run as a public service this wouldn’t be an issue.

    There are 28 lines companies in New Zealand all facing falling revenue and static fixed costs.

    “I’m willing to bet that’s a big part of the problem.” ANTHONY ROBINS

    And you would be right.

    If the generation and distribution of our electricity supply was still in public hands losses in one area would more than cover losses in other areas. The private investors are trying to hold onto to their returns in the face of new technology. Efficiencies will be sacrificed if they affect the bottom line.

    The not so invisible hand of the market is raised to slap those who dare to try and do something that challenges the market, (and market returns.)

    If the generation and distribution of our electricity supply was still in public hands efficiencies in generating more electricity could be rewarded instead of being slapped down.

    For instance just imagine the screams of outrage from the private investors, if government dared to impose a feed in tariff rewarding those who generated their own power and fed it into the grid.

    But imagine if you can, the benefits to the public and environment instead.

    Battery back up is a huge part of the cost of installing photovoltaics, with a feed in tariff the hydro lakes would become your batteries removing the need to have your own.

    While the sun shines the hydro could be scaled back to allow more to be drawn by the householder at night, to the same amount as they contributed to the grid during sunlight hours.

    Sensible, reasonable, achievable?

    Not if the market has anything to do with it.

    • Gristle 18.1

      The two companies Unison and Eastland are identified as culprits. Both companies are community owned entities. (Eastland seems to have its finger in a huge number of pies keeping the East coast as a viable place to live.)

      Through out this series of posts it has been lamented that the grid owners are not public.

      • Draco T Bastard 18.1.1

        Well, how much say do the public have in the running of these companies?

        • Lulu

          The community elect the trustees who, in turn appoint the boards of the community owned companies. You did remember to vote for your trustees didn’t you?

          • Draco T Bastard

            Never been asked which tells me that the public have no say in the running of these trusts.

            • Lulu

              You mustn’t be in a network area where the lines company is owned or part owned by a trust.
              The fact that you “never been asked” is not evidence that that the public don’t have a say in running the community trusts. By definition, where there are community trusts they must be elected by the community.

              • Draco T Bastard

                The fact that you “never been asked” is not evidence that that the public don’t have a say in running the community trusts.

                Actually, it is as The Public isn’t just the people with power bills.

                And I’m in an area serviced by Vector which is one of the largest New Zealand companies on the NZX with over 700,000 customers. There’s only 1.5 million houses in NZ. Of course there’s also businesses to be counted but there will fewer of those than there are houses.

                Networks like this are a monopoly and thus need to be state owned and answerable to the public.

                • Lulu

                  Dear oh dear. Draco you own 75.4% of Vector:

                  “The Auckland Energy Consumer Trust (AECT) is Vector’s majority shareholder. It owns 75.4% of Vector and is a consumer trust. It holds and manages its majority shareholding on behalf of its beneficiaries (electricity customers in the old areas of Auckland City, Manukau City and parts of the Papakura District). Private investors hold the balance of the shareholding.

                  Vector delivers consistent returns to shareholders and under our ownership model we also return more than $100 million annually to the AECT.”

                  • Draco T Bastard

                    1. No I don’t
                    2. That doesn’t make it answerable to the public nor does it make them do what actually needs to be done
                    3. The private investors are simply bludgers

                    • Lulu

                      Ok Draco you are welcome to your view. For me the facts remain:
                      1. You and your fellow Aucklanders are the owners of 75.4% of Vectors activity as a monopoly lines provider and as an operator in some contestable businesses as well.
                      2. You and your fellow Aucklanders receive 75.4% of dividends as beneficiaries of the AECT.
                      3. You and your fellow Aucklanders appoint the trustees and they hold the majority vote on what the business does and does not do. If you would like to make yourself available to be a trustee I will vote for you.
                      Point numb 3 is ideological. I accept and respect your opinion.

                    • Draco T Bastard

                      No I don’t and no I’m not – I’m not a direct customer. What you’re claiming for all Aucklanders really only applies to the minority of people.

      • RJM 18.1.2

        Transpower is also a state owned and operated company. Some of the local area networks are also owned by local government-owned entities – Aurora in Dunedin and some of Otago.

    • Draco T Bastard 18.2

      The not so invisible hand of the market is raised to slap those who dare to try and do something that challenges the market, (and market returns.)

      That’s not actually correct.

      It’s the very visible hands of the bludging capitalists trying to protect themselves from the actions within the market.

      While the sun shines the hydro could be scaled back to allow more to be drawn by the householder at night, to the same amount as they contributed to the grid during sunlight hours.

      Sensible, reasonable, achievable?

      And what would likely happen in a market economy unbound by capitalist greed.

      Not if the market has anything to do with it.

      No, it’s not if the capitalists have anything to do with it. They’re working very hard to protect their parasitical lifestyles that we pay for.

      If we were truly going to have a free-market then we need to get rid of capitalism.

    • Ad 18.3

      That horse has bolted a few years ago.
      There is no Parliamentary political combination that will ever bring that back.

    • Lulu 18.4

      “if government dared to impose a feed in tariff…”
      If you are suggesting that government use my taxes to subsidize people who can afford to pay $10,000 to put solar on their roofs then be clear – I don’t want my taxes used that way.
      For the sake of further clarity I am not a private investor but I am a taxpayer. .

  18. bm2 19

    does these charges apply if you use solar to heat water technically your not generating power your taking power savings indirectly in reduced power the doesn’t show up on rentier radar

    • ianmac 19.1

      I suppose a solar house does not need to tell the supplier that they have solar to heat water. The company would just see a house using very little power to heat water just like a solar water heater does.
      A good way to look at solar electric is just look at the units that you are not buying from the grid. The 8cents per unit they pay you for exporting is minimal.

      • JonL 19.1.1

        Better off just using a conventional solar heater.
        We have 4Kw of solar panels which generate about 9 Kw in winter and 20kwh/day in summer. But…we’re in rural West Oz. So…better production and more power is generated when needed.
        The ” rich being subsidised by the poor” sounds like the same plaintif mew issued by the power companies over here – straight from the neo- lib handbook. They tried that on over here but had to backpedal very quickly. Mind you…there is a high uptake of pv power by average households over here…a decent 5Kw system is around $6000 now.

  19. NZJester 20

    If that extra energy they are generating is being sold on at a profit that includes the line charge in the cost, is this not in fact double dipping by also charging the generator of the power? The transmission of that power over the lines was paid for by the people they on-sold the power to? They made a profit on that power and received maintenance money for the transmission of it!

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