The Otago-Southland Employers' Association and the Northern Employers and Manufacturers' Association are at odds about what constitutes a fair electricity transmission price.
The Otago Southland Employers' Association contends the current pricing methodology is a grossly unfair and inequitable burden on Otago-Southland businesses and consumers that must be rectified at the earliest possible opportunity.
The EMA is calling the Electricity Authority's proposed pricing regime changes a regional tax by stealth.
EMA members were facing significant increases in their electricity pricing with no right of recourse, chief executive Kim Campbell said.
But Otago-Southland association chief executive Virginia Nicholls said the prolonged use of the status quo served to entrench an inefficient signal to local businesses to underuse transmission services.
That resulted in missed economic opportunities to invest and create jobs or put existing jobs at risk.
"While change creates winners and losers, this is not the benchmark against which regulatory change should be measured. New Zealand's regulatory settings need to reflect the 21st-century reality of best-practice of signalling to consumers the true value of the services they receive, not antiquated views of smearing costs evenly across the country. The status quo is unsustainable.''
A key element, in the view of the Otago-Southland association, of efficient prices was to ensure those who benefit from the transmission services provided pay for them, she said.
It was clear that had not been the case for some time and it was hampering the domestic and global competitiveness of southern regional businesses at a time of global economic fragility.
"While there may be areas that need further work, we consider these to be minor.''
In a submission to the Electricity Authority on behalf of the association, Mrs Nicholls said more than $1.3 billion of transmission investment had been commissioned in the upper North Island since 2004. But only 39% of the upgrade was being paid by the upper North Island.
Transmission costs in the lower North Island and South Island had increased by 61% on average to pay for the upgrades.
It was not an economically efficient outcome for New Zealand to have regions so close to abundant hydro generation and with a desire, in some areas, to increase industry and population, to have the regional advantage undone by transmission pricing.
A pricing model encouraging energy intensive industry to be located close to electricity generation promoted better outcomes for New Zealand, Mrs Nicholls said.
Mr Campbell maintained Auckland customers would have to foot a near $80 million increase.
Whangarei customers faced a 58% increase and customers further north faced an increase of 121%.
Other areas isolated from the national grid and needing assistance with regional development, such as Westland, were the big losers.
The main beneficiaries appeared to be the big South Island generators and the already heavily subsidised aluminium smelter at Tiwai Point, he said.
"This is a tax by stealth on our members and for some of them it will severely impact their businesses.''
Mrs Nicholls said in response Auckland consumers would have a price rise of 3.4%, or $58 per household per year, and it would not take effect until April 1, 2019, at the earliest.
In relation to the other 28 network areas, 19 were estimated to have a decrease in prices of up to 4.5%, including nearly all significant population centres outside Auckland, such as Hamilton, Tauranga, Hawke's Bay, Wellington, Christchurch, Dunedin and Invercargill.
For the nine other regions, along with Auckland, projected to have a price increase, the increase on average was 1.75%.
They were: Buller 1.5%, or $26 per household per year; Counties 1.7%, or $33; Electricity Ashburton 5% or $102; Horizon 0.2% or $3; Network Waitaki 1.2%, or $21; Northpower 2.3% or $36; The Lines Company 0.2% or $4; Top Energy 1%, or $21; Westpower 2.7%, or $49.
Electricity Ashburton now paid a low level of transmission costs and Westpower's transmission charges were among the lowest of all distributors.
