Prices dropped 0.5% in the December 2011 quarter and followed a 0.3% decrease in the previous year, results Consumer New Zealand chief executive Sue Chetwin yesterday described as "fantastic" for consumers.
But there are already indications that decreases will not continue.
Yesterday, Network Waitaki announced about 12,000 consumers in North Otago and the Hakataramea Valley face increased line charges from April 1, adding $1.43 a week to the average domestic electricity bill. Line charges will rise between 11% and 12%, depending on consumption, to cover the company's own cost rises and a major 23.4% increase in Transpower transmission charges, mainly because of upgrades programmed in Auckland.
Price reviews were under way at network management companies PowerNet Ltd, which delivers power to 65,000 customers in Invercargill City, Southland, North, South and West Otago, Stewart Island and Frankton, and at Aurora Energy, which supplies 81,500 homes and businesses in Dunedin and Central Otago, the chief executives of both companies said yesterday.
Transpower price increases would affect all lines companies, PowerNet Ltd chief executive Jason Franklin and Aurora Energy chief executive Grady Cameron said. But neither would be drawn on whether their customers would face increased charges, saying they were not prepared to comment until reviews had been completed.
Network Waitaki's increases were larger than previous years' and reflected the higher Transpower charge and the company's own increased requirements for asset replacement and network development projects in coming years, chairwoman Clare Kearney said.
Because of the way Transpower set its prices, Network Waitaki's consumers, with others in the South Island, had to pay for upgrades in the North Island with little direct benefit to them.
"Transpower's 23.4% increase in transmission charges to Network Waitaki is largely to pay for upgrades into the Auckland region," she saidAlso, planned Transpower projects, which Mrs Kearney said were vital to the long-term security and reliability of supply to the Waitaki district, had been deferred because they were deemed to be of lower priority by Transpower.
All shares in Network Waitaki are owned by the Waitaki Power Trust, on behalf of consumers. Trust chairwoman Dr Helen Brookes said Network Waitaki would be facing higher costs this and in coming years and consumers needed to be assured of a reliable power supply with flexibility and resilience, despite increasing consumer demand and constraints placed on it by lack of investment from Transpower.
"Higher-than-inflation increases in distribution charges are therefore unfortunately necessary." Network Waitaki profits are returned to consumers by way of an annual discount, which last year was $179.48 for domestic consumers, equivalent to $3.45 a week.
