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Transpower Well Positioned for Grid Enhancement

Transpower Well Positioned for Future Grid Enhancement

The owner and operator of the national electricity grid, Transpower New Zealand Ltd, has reported a net surplus after tax and before asset revaluation for 2002/03 of $56.5 million.

“Transpower will pay the Crown a final dividend of $16.5 million based on its full year results to 30 June 2003, making a total dividend for the year of $38.5 million,” Sir Colin Maiden, Chairman of Transpower, announced today.

In 2001/02 Transpower’s net surplus after tax and before asset revaluation was $80.2 million.

Sir Colin said that a reduction in transmission services revenue of $28.7 million was the primary factor behind the reduced profit this year. Transmission services revenue in 2001/02 had been higher than normal due to the one-off impact of a settlement with Meridian over disputed charges.

In commenting on the 2002/03 performance, Sir Colin said that the year was characterised by good operational results and increased capital expenditure.

“Operational performance was strong, with Transpower meeting or exceeding both the targets set out in its Statement of Corporate Intent and results achieved last year against system security objectives.

“During the year, Transpower undertook a number of initiatives to get more capacity out of existing grid assets. This focus was reflected in an increase in capital expenditure of $14.6 million to $104.0 million, up 16% on the previous year.

“Looking further ahead, substantial new investment is required in the national grid by the end of the decade.

“A combination of higher demand for electricity driven by economic and population growth and an ageing national grid make new investment essential sooner rather than later. Planning for grid investment will be a key priority for Transpower over the coming year.”

Sir Colin said that in addition to its focus on meeting operational and commercial targets, Transpower was an active participant in the ongoing industry reform process.

“Transpower supports the establishment of the Electricity Commission and believes that the new regulatory environment provides the opportunity for much needed certainty and clarity of accountabilities for the company and other industry participants.

“We anticipate working closely with the Electricity Commission during the coming year on a range of issues related to Transpower’s core functions of managing the national grid and providing System Operation services,” concluded Sir Colin.

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