Auckland's North Shore faces 15pc rise in power bills

By RENEE KIRIONA and MARTIN JOHNSTON


Tens of thousands of householders and businesses on the North Shore will pay about $200 more a year for electricity from next month.

The need for the big rises, which will also hit thousands of Central Otago consumers, has been questioned by the Consumers Institute and the Electricity Networks Association, which represents lines companies.

The institute's chief executive, David Russell, described them as deeply concerning.

"The point of the electricity reform plan was to ensure we have a stable supply [of electricity] at a reasonable cost," he said.

From February 15, EmPower's 70,000 customers on the North Shore will pay an estimated $214 (14 to 15 per cent) more a year.

For the 20,000 customers of Trustpower in Central Otago, the estimated rise is $155 (7 per cent) a year.

While Genesis, Mercury Energy, Meridian Energy and budget retailer Energy Online had no immediate plans to increase their prices, they all agreed that higher costs for consumers were inevitable.

They blame rises in wholesale electricity costs, which make up about 30 per cent of the average power bill.

Last year, wholesale rises led Meridian to increase its prices by 15 per cent for its 230,000 customers. In August, Mercury started to charge residential customers in the Auckland region 18 per cent more.

Wholesale prices had risen because the industry had to resort to more expensive energy sources, such as non-Maui gas.

National Party energy spokesman Roger Sowry said environmental legislation had also played a role in hindering the development of new electricity generation facilities.

The networks association's chief executive, Alan Jenkins, said the price rises were hard to justify. The retailers' rationale was that they were partly to pay for future non-Maui-gas electricity facilities.

He also blamed the price rises on weak competition between the big electricity retailers.

Energy Minister Pete Hodgson could not be contacted last night.

Mr Russell said the new Electricity Commission, which would regulate the market from March 1, must take a harder line if the increases continued.

Ins and outs

Estimated annual power bills

North Shore

Meridian Energy: $1360.

EmPower/Contact Energy: $1498 (plus an estimated $214 from February 15).

Mercury Energy: $1507.

Central Otago

Contact: $1801.

Meridian: $1959.

Trustpower: $2172 (plus an estimated $155 more from February 20).

These estimates are based on a household of 3-4 people where electricity is the main source of power.

Source: Consumers Institute website

Power profits

Most recently published 12-month net profit figures:

* Contact Energy-EmPower: $118.3 million.

* Trustpower: $36.9 million.

* Mighty River Power-Mercury Energy: $113.5 million.

* Genesis: Net profit: $61.1 million.

* Meridian Energy: $111.9 million.

Contact and Trustpower are listed on the stock exchange; the other three are state owned and paid dividends totalling $95.4 million to the Government last year.