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

 


Lower Prices Puts Energy Security At Risk

Media Release
November 10th 2004

LOWER PRICES PUTS ENERGY SECURITY AT RISK

Energy sector regulation focused on short term gains to consumers at the expense of improving the network leads to power outages, says a visiting energy economist.

Margaret Beardow is visiting from Australia at the invitation of the Electricity Networks Association (ENA). The ENA represents the interests of the 24 organisations that distribute electricity to consumers throughout New Zealand.

Mrs Beardow said "widespread power outages in many countries including the UK, the US, and Australia are making governments rethink their approach to regulating energy networks. New Zealand has the opportunity to benefit from their mistakes.

"Countries are realising that if their energy regulatory frameworks focus on lower prices and not on longer term sustainability of supply, they place infrastructure at risk."

As the energy sector is so critical to a country's growth, regulation decisions must give equal consideration to long term stability and investment, Mrs Beardow said.

New Zealand regulators had the opportunity to heed the hard lessons of other countries and ensure that the regulation implemented here put it at the front, not the rear, of regulatory practice.

"With this in mind, the Ministry for Economic Development's decision to review the Commerce Commission's decision over gas regulation should be welcomed by the industry."

Mrs Beardow said in Australia, past decisions of regulators were now regarded as overly aggressive. When outages did occur it was the industry and its management, and not the regulators that forced the cost reductions, that took the blame.

The Australian Productivity Commission released a report on gas regulation this year that found its current Gas Access Regime could distort investment through cost-based price regulation and high monitoring costs which were of no benefit to the economy.

"It would be a shame if New Zealand followed down the same path as Australia only to realise that it would end up costing the public dearly."

Mrs Beardow is addressing the ENA on Wednesday November 10th.

Ends


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half A Billion Accounts: 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>>

ALSO:

Half Full: Fonterra Raises Forecast Payout As Global Supply Shrinks

Fonterra Cooperative Group, the dairy processor which will announce annual earnings tomorrow, hiked its forecast payout to farmers by 50 cents per kilogram of milk solids as global supply continues to decline, helping prop up dairy prices. More>>

ALSO:

Results:

Meat Trade: Silver Fern Farms Gets Green Light For Shanghai Maling Deal

The government has given the green light for China's Shanghai Maling Aquarius to acquire half of Silver Fern Farms, New Zealand's biggest meat company, with ministers satisfied it will deliver "substantial and identifiable benefit". More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news