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


CMA: Contact ‘price gouging, plain and simple'

Canterbury Manufacturers’ Association

27 September 2006.

The Canterbury Manufacturers’ Association says that the forthcoming rise in electricity prices by Contact Energy is a ‘price gouging, plain and simple’.

The Association also disputes Contact’s assertion that the transferring of costs onto consumers is a ‘reality of the industry’ given that the company posted a profit of $280 million this year - a rise of 14 percent on 2005.

“Energy companies are guaranteed to retrieve their long run marginal costs through their pricing. Here is a company sitting on $4.6 billion in assets and New Zealand’s largest wholesaler and retailer of natural gas saying that it has no option but to pass the costs of managing those assets onto the consumer. This might be good news for some but it is the consumers are having to pay” says CEO John Walley. “In the absence of any real competition retail prices will continue to escalate without any of the natural controls associated with a free market”.

“Consumers should be angry at such rises. Especially as 15 cents on each dollar of there electricity bill pays for the competitive sham of electricity retailers, with what benefit for the consumer?” asks Mr. Walley. “Where is the promise of competition, where is promise of the market, where is the promise of consumer choice?”

Mr. Walley says that electricity pricing and reliability has an increasingly political dimension, especially following this year’s blackouts, growing demand and an absence of any effective response on supply and transmission.

“There seems too much complacency from Government, and the industry seems comfortable about the money it is guaranteed to make. There are alternate strategies; it seems the only way for those to be considered will be for consumers to demand them through the ballot box. It is time that the New Zealand electricity consumers made our politicians take notice”.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Voluntary Administration: Renaissance Brewing Up For Sale

Renaissance Brewing, the first local company to raise capital through equity crowdfunding, is up for sale after cash flow woes and product management issues led to the appointment of voluntary administrators. More>>


Approval: Northern Corridor Decision Released

The approval gives the green light to construction of the last link of Auckland’s Western Ring Route, providing an alternative route from South Auckland to the North Shore. More>>


Media Mega Merger: Full Steam Ahead For Appeal

New Zealand's two largest news publishers have confirmed they are committed to pursuing their appeal against the Commerce Commission's rejection of the proposal to merge their operations. More>>

Crown Accounts: $4.1 Billion Surplus

The New Zealand Government has achieved its third fiscal surplus in a row with the Crown accounts for the year ended 30 June 2017 showing an OBEGAL surplus of $4.1 billion, $2.2 billion stronger than last year, Finance Minister Steven Joyce says. More>>


Mycoplasma Bovis: One New Property Tests Positive

The newly identified property... was already under a Restricted Place notice under the Biosecurity Act. More>>

Accounting Scandal: Suspension Of Fuji Xerox From All-Of-Government Contract

General Manager of New Zealand Government Procurement John Ivil says, “FXNZ has been formally suspended from the Print Technology and Associated Services (PTAS) contract and terminated from the Office Supplies contract.” More>>