Transpower rules out paying dividend

By CHRIS DANIELS energy writer

Transpower, the state-owned enterprise that owns and runs the electricity grid, made $31.5 million profit in the second half of 2003.

The profit is $200,000 lower than for the same six months in the previous year and was earned from total revenue of $258.8 million, which was $1 million lower.

Explaining why no interim dividend would be paid to its Government owners, chairman Sir Colin Maiden said it was inappropriate given the uncertainty around the quantity and timing of capital needed to invest in big projects to upgrade the national grid.

"Investment in the order of $1.5 billion by 2010 will place significant pressure on Transpower's balance sheet," he said.

"For the most heavily loaded parts of the national grid, the need is for new, or upgraded, lines in just a few years from now. Supply into the Christchurch region needs to be reinforced by the winter of 2009, with the Auckland region to follow a year later."

Transpower expects that after 2010 it will need to invest a further $100 million a year until 2020.

Plans include upgrading powerlines from Otahuhu to Henderson, buying up to 200km of "easement" about 65m wide between Whakamaru and Otahuhu, upgrading one line of the high voltage, direct current system linking the North and South Island grids and laying two new cables across Cook Strait.