Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Powerco Welcomes Greenlight For Generation

Powerco Welcomes Greenlight For Generation

New Zealand’s second largest electricity lines company and largest gas pipes company, Powerco, welcomed today’s Government announcement which will allow the lines sector to invest in generation.

The Government’s proposal will permit lines companies to invest in and own standby generation and standard day-to-day generation of up to 25 megawatts, or 10 per cent of their load.

Powerco Chief Executive, Steven Boulton, said allowing the lines sector to expand into generation would help provide the electricity industry with much needed flexibility, and would increase competition and efficiency in the sector.

“Providing the lines sector with an opportunity to play a role in developing new generation could result in lines businesses building small, efficient, regional generation plants connected straight into local networks, as well as larger standby stations,” he said.

“This proposal could also help reduce overall transmission loads on the national grid and provide communities with small localised sources of electricity.

“The benefits to consumers are evident.”

Mr Boulton said allowing lines companies to play a role in generation posed an interesting next question as to whether the door to retailing should also be opened to lines companies. “With today’s announcement providing some capacity for industry reintegration, the discussion about the role of lines companies in selling their own electricity to consumers is one we are looking forward to having with Government,” he said.

However Mr Boulton said he was concerned at a suggestion that lines charges would be regulated so that generators were charged ‘no more than was reasonable’ for connecting to local lines.

“With the desire for quick new generation, the lines sector will be nervous that any embedded generation projects will be connected to local lines at unrealistic or opportunistic regulated prices.

“If we are to encourage additional investment in our national infrastructure, and a stronger, more competitive electricity market, then the costs of connecting new generation must not be artificially imposed through regulation,” he said. Regulating these connections could simply mean that consumers would be required to subsidise this investment as well.

Mr Boulton said the agreement between Powerco and TrustPower in which Powerco will connect Trustpower’s Taraurua windfarm directly into its lines was an example of two publicly listed companies coming to an appropriate and fair commercial arrangement. We also have a number of other generation investors who have engaged with Powerco to achieve commercial outcomes to connect distributed generation said Mr Boulton.

“There is plenty of evidence that the market is working effectively in this area and, on the other hand, evidence that regulation, or fear of regulation, is stymieing the investment needed for sustainable national economic growth. The fundamental economic issue remains focused on developing a business environment for the whole electricity sector – where ongoing investment is incentivised. The sector will, I am sure, be openly talking with Government on this point.”

Powerco is New Zealand’s largest gas and electricity distributor in terms of network length, the largest gas distributor and second largest electricity distributor in terms of total consumer connections. Powerco has approximately 295,000 electricity consumer connections and 106,000 gas consumer connections in the North Island. Powerco is a publicly listed company, listing on the NZSE in December 2000 and was included in the NZSE40 index on December 2, 2002.

© Scoop Media

Business Headlines | Sci-Tech Headlines


Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>


Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>


Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>


Half A Billion Accounts, Including Xtra: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>


Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news