TrustPower raises flag as $9.5m plan halted

TrustPower is signalling a possible impairment charge to its accounts after halting a new customer information system project at the end of the design phase when costs escalated.

TrustPower engaged Oracle to deploy its Utilities Suite to replace TrustPower's existing customer information system.

"Following the completion of the design phase, TrustPower and Oracle are now able to predict the duration and cost of the development and implementation of the system, and both of these features have exceeded the planned duration and cost established at the commencement of the project," the company said.

As a result, TrustPower has decided to pause further implementation of the project so it can look at ways of reducing the project's costs and consider alternatives.

About $9.5 million has been committed to the project. It is likely that a proportion of these costs will be impaired once a full review of available options has been completed over the next two to three months.

TrustPower said it had electricity sales of 3169GWh for the nine months to December 31, a small increase on the prior period.

Its main hydro storage catchments are currently at, or above, average levels for this time of year following good inflows during the third quarter and early January 2010.

TrustPower's total New Zealand generation production for the reporting period was 1620GWh, down 6 per cent on prior period. This was primarily due to lower North Island hydro production during the first half of the current financial year.

- NZPA