Electricity action – please get on with it

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Electricity action – please get on with it

Businesses are worried about electricity, says Business NZ.

Chief Executive Simon Carlaw says there’s been no action by either power companies or the Government to head off a possible repeat of last winter’s power price blues.

“Ominously, lake levels have started tracking downwards in a similar pattern to this time last winter.  Spot prices have jumped again in the last two weeks.  And those companies whose electricity contracts are coming up for renewal are finding the new contract being offered is much more expensive than the last. 

“There’s no silver bullet to get prices down, but there are a range of moves that could help.  The recommendations that came out of last year’s winter review (1) for example, or Dr John Small’s proposals for a mandatory hedge market (2) – these could make hedge contracts more readily available and could put downward pressure on prices.

“But there appears to be no move by either the power companies or the Energy Minister to begin to implement them in a timely way,” Mr Carlaw said.

“The Minister of Energy and the power companies were also working on a cross insurance plan to make more electricity supply available - but there’s still no indication of anything tangible here either.

“Businesses do not want to face another winter of cripplingly high electricity costs.  They need prompt action.  The onus is on the power companies and the Energy Minister to come up with it.”

(1)   www.winterreview.govt.nz

(2)   ‘Hedge Markets for Electric Power in NZ’ on www.med.govt.nz