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More Power Price Rises Outrageous

More Power Price Rises Outrageous

Today’s price rise warning from another electricity generator is being greeted with concern by the lines industry.

Contact Energy’s new majority shareholder, Australia’s Origin Energy, is warning New Zealanders to brace ourselves for more price rises, news that Electricity Networks Association Chairman Warren Moyes says is outrageous. “Hearing this just a day after Origin’s takeover of Contact was announced is particularly disturbing. It suggests that Origin have bought in knowing that there will be no constraints on their ability to increase prices.”

“For electricity consumers this news is quite alarming”, he says. “It seems fairly clear now what the recent high profile $2.5 million Contact Energy advertising campaign has been all about. Those friendly Tuis and full-page ads strongly suggest that Contact have been softening us up for their new majority owner to start mining the power consumer.”

“Its all very well for Origin to now tell us that their Australian customers have already seen prices go up. They don’t seem to have noticed that New Zealand householders are already paying more for power than Australians as a result of the policies of the past 5 years.”

“The Government has a blind eye approach to the behavior of the major generator/retailers” Warren Moyes says. “It has reached farcical levels when the Minister tells the lines industry it can’t enter the retail market in case it cross-subsidises consumers, while the companies entrenched in that market are given an apparently unconstrained right to crank up profits.”

“The lines industry has been reducing charges steadily over the past 5 years. However, there are few signs of these reductions being passed on to consumers by the retailers. We now have an Electricity Commission set up by the Government. Surely it should be an immediate priority for it to look hard at issues such as competitive pressures and rising prices in generation and retailing.”

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