KEY POINTS:
Government-owned national grid operator Transpower is notifying power companies today of price increases it was forced to reduce by a Government-appointed watchdog.
The Commerce Commission threatened to take control of Transpower after it announced a 19 per cent price increase for the 2006/07 year and forecast a 13 per cent a year increase for the next four years after that.
The national grid operator and its regulator have since been holding talks on a administrative settlement as an alternative to the taking of control.
Today Transpower notified customers of a 12.2 per cent rise for the 2006/07 year, down from the 19 per cent rise it wanted.
The increase for 2007/08 is 2.7 per cent so the compounded increase over the two years is 15.2 per cent.
It could change in the negotiated settlement. But the Commission said it accepted that Transpower had to notify customers.
"While discussions continue on a possible administrative settlement, the Commission's preliminary view is that these are appropriate price changes," said commission chair Paula Rebstock.
The commission said that complexities of Transpower's accounting system meant that customers will feel the effects of the increases on April 1, 2007.
"The commission remains optimistic that an administrative settlement can be reached," Ms Rebstock said.
- NZPA
