Power upgrade spells Wairarapa price rise

A $12 million upgrade of the Cornwall Rd substation has future-proofed most of Wairarapa's power supply - but could have an impact on consumers' bills next year.

Two new transformers, at a cost of $1.5 million each, and an indoor switchroom have been built at the Carterton substation over the past eight months.

They replaced seven 50-year-old transformers and doubled the station's energy capacity, from 30,500kVA to 60,000 kVA.

Transpower's customer relationship manager Ian Harris said the new infrastructure would be more reliable.

"It will support future economic development. It has built in capacity for growth."

The substation provides power for households and businesses from Carterton to Eketahuna, and the upgrades are part of a national series of infrastructure upgrades which he said are worth around $1 billion.

Mr Harris said the costs to the state-owned enterprise needed to be recovered, which is done through a charge which makes up a proportion of lines companies' charges.

"Across New Zealand each area pays on the amount of equipment they use and the amount of electricity supplied. There will be some increase in electricity charges ... it's recovered from the country, from all customers." Powerco spokesman Neil Holdom said the substation upgrades would not affect pricing until the company revised charges.

"On the first of April next year Transpower set whatever charges they need to, and we bundle those up and then they're passed on to consumers."

Mr Holdom said Powerco charges electricity retailers, who then choose how much to pass on to the consumer.

According to Ministry of Business and Innovation figures, Powerco increased its Wairarapa prices to retailers 9.1 per cent between August 2011 and August 2012, and most retailers increased their charges between 3.1 and 8.6 per cent in the same period.

Masterton mayor Garry Daniell said reliable power was crucial to industry in Wairarapa, and industry was crucial to growth.