Commission Receives EIR Act Exemtion Application
Commission receives application for EIR Act exemption from Centro Properties Group
The Commerce Commission has received an application from Centro NZ Shopping Centre Fund Limited and related entities (the Centro Group) for an exemption under the Electricity Industry Reform Act 1998 in relation to ownership separation provisions.
The Centro Group is an Australian retail property investment and services organisation. The application relates to the Centro Group’s proposed acquisition of several properties. All of the properties comprise retail shopping outlets.
The properties are leased to third parties, and Centro entities propose to supply electricity to those tenants whilst owning and operating the embedded electricity networks at each site. The Centro Group seeks an exemption in relation to the cross-involvements that would result.
The purpose of the EIR Act is to reform the electricity industry to better ensure that costs and prices in the electricity industry are subject to sustained downward pressure and the benefits of efficient electricity pricing flow through to all classes of consumers, by effectively separating electricity distribution from generation and retail and promoting effective competition in electricity generation and retail markets.
The Commission may grant an exemption in respect of a business or involvement or interest, only where doing so:
a. would not result in certain involvements in electricity lines businesses and electricity supply businesses which may create incentives or opportunities:
i. to inhibit competition in the electricity industry; or
ii. to cross-subsidise generation activities from electricity lines businesses; and
b. would not result in relationships between electricity lines businesses and electricity supply businesses which are not at arms length.
For further information on the Commission’s role within the EIR Act, visit the Commission’s website, http://www.comcom.govt.nz/acts/eiract/
A public version of the application is available on the Commission’s website, http://www.comcom.govt.nz/PublicRegisters/eira.aspx