Electricity Commission sacking will 'undermine' confidence

Major electricity users yesterday warned Government interference in the industry could be at the expense of business.

Ralph Matthes, executive director of the Major Electricity Users Group, said the Government's sacking of Electricity Commission chairman Roy Hemmingway would undermine confidence in the industry regulation.

It opened the door to special pleading rather than a regulator that balanced the needs of all.

Matthes said: "We had confidence that Roy Hemmingway would play with a straight bat. I have no doubt this is about making the commission more malleable."

The Government did not have the expertise to adjudicate the numerous special interests nor get to grips with the highly-complex technical issues.

In the short term, Hemmingway's sacking would not have a great effect on the industry but, in the long term, sound decisions - such as making the South Island generators partly pay for the link to the North - could be re-examined.

"There is a risk that some of these things that they have done well will be reviewed," Matthes said.

Hemmingway lashed out at the Government after Energy Minister David Parker issued a press release claiming the regulator was stepping down.

He said he had been sacked but was proud of what he had achieved. He also warned against interference.

"Politicising electricity decisions will hurt investor confidence and result in an even more confusing muddle of policies than now. In the past, it has resulted in projects being built that are wasteful and unnecessary and New Zealand must be careful that this is not the result again."

Hemmingway also targeted sparring partner Transpower, saying its behaviour was the worst he had seen from a regulated entity.

Transpower replied, saying: "It is unfortunate Mr Hemmingway feels so bitter but we do not want to get into name calling."