Electricity Crisis Undermines Credibility Of NZ
“Insanely high” electricity prices and the threat of water shortages in hydro dams undermines the credibility of the local electricity market and raises questions about the safety of investing in New Zealand, according to the Major Electricity Users Group (MEUG).
Terrence Currie, Chairman of MEUG, said record high electricity prices over the past three months had forced major industries to reevaluate the cost of running businesses in New Zealand.
“This crisis will leave an indelible stain on New Zealand’s reputation as a good place to conduct business – international investors will worry that electricity is too expensive, and its supply is uncertain.
“Power crises put consumers under temporary discomfort, but the damage is far more fundamental and long-term for business.
“High prices have forced cuts in output for some businesses. Others cannot afford to cut their production as this would seriously jeopardise future export orders. but the extra cost has destroyed all profit margins, so the exports will be supplied at a loss,” Mr Currie said.
He said the matter required immediate action by Government to lower consumer demand, and to review what changes were needed to make the electricity market perform better for consumers.