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

 


Privatisation candidate drops power prices 1.4 percent

Privatisation candidate drops power prices 1.4 percent

By Pattrick Smellie

Jan 21 (BusinessDesk) - Mercury Energy, the electricity retailer owned by partial privatisation candidate MightyRiverPower, has announced its first across the board price cuts in a decade.

The cuts average 1.4 percent for most of its customers in its home territory, Auckland, and will apply from April 1.

The cut is credited to an order by the government's competition watchdog, the Commerce Commission, to the owner of Auckland's electricity network, Vector, to cut its prices because it has been earning higher than allowable rates of return. The last such across the board cut for residential customers was in 2002-2003, a Mercury spokesman said.

However, Mercury is holding back some of the cut to make a 2.9 percent increase in the cost of the energy it delivers down the lines.

Vector is still fighting the price regulation findings in the courts, and further adjustment to the charges could yet ensue, but Mercury is passing on the reduction from April 1 - timing that coincides neatly with the likely timetable for the planned partial privatisation of its parent, state-owned MRP.

Assuming the New Zealand Maori Council is unsuccessful in its challenge to the planned sales in a Supreme Court hearing later this month, the government's intention is to sell up to 49 percent of MRP, while maintaining a controlling 51 percent stake in taxpayers' hands before June 30.

The price cut comes after a year in which electricity prices rose by an average of 5.2 percent across the country, against the tide of total inflation for the year of 0.9 percent, according to Statistics New Zealand's consumers price index for the December 2012 quarter, released last week.

The value of the reduction per household on average is some $2.50 a month, Mercury said in a statement.

Mercury general manager James Munro said the impact of distribution and transmission charges accounted for more than 40 percent of the monthly power bill, the majority of which is the local distribution charge.

"Combined with an increase in the transmission charges from Transpower (the national grid operator), which are also regulated under the Commerce Act, total lines charges are decreasing by an average 7.5 per cent," Munro said.

"Within the overall review of our prices, Mercury Energy has increased its energy charge by 2.9 per cent to meet general cost pressures within our retail business," he said. "The energy charge accounts for just under 60 per cent of the total bill."

Prices for other regions will be available in coming weeks once all distribution company and Transpower charges are known.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Power Outages, Roads Close: Easter Storm Moving Down Country

The NZ Transport Agency says storm conditions at the start of the Easter break are making driving hazardous in Auckland and Northland and it advises people extreme care is needed on the regions’ state highways and roads... More>>

ALSO:

Houses (& Tobacco) Lead Inflation: CPI Up 0.3% In March Quarter

The consumers price index (CPI) rose 0.3 percent in the March 2014 quarter, Statistics New Zealand said today. Higher tobacco and housing prices were partly countered by seasonally cheaper international air fares, vegetables, and package holidays. More>>

ALSO:

Notoriously Reliable Predictions: Budget To Show Rise In Full-Time Income To 2018: English

This year’s Budget will forecast wage increases through to 2018 amounting to a $10,500 a year increase in average full time earnings over six years to $62,200 a year, says Finance Minister Bill English in a speech urging voters not to “put all of this at risk” by changing the government. More>>

ALSO:

Prices Up, Volume Down: March NZ House Sales Drop 10% As Loan Curbs Bite

New Zealand house sales dropped 10 percent in March from a year earlier as the Reserve Bank’s restrictions on low-equity mortgages continue to weigh on sales of cheaper property. More>>

ALSO:

Scoop Business: Chorus To Appeal Copper Pricing Judgment

Chorus will appeal a High Court ruling upholding the Commerce Commission’s determination setting the regulated prices on the telecommunications network operator’s copper lines. More>>

ALSO:

Earlier:

Cars: Precautionary Recalls Announced For Toyota Vehicles

Toyota advises that a number of its New Zealand vehicles are affected by a series of precautionary global recalls. Toyota New Zealand General Manager Customer Services Spencer Morris stressed that the recalls are precautionary. More>>

ALSO:

'Gardening Club': Air Freight Cartel Nets Almost $12 Million In Penalties

The High Court in Auckland has today ordered Swiss company Kuehne + Nagel International AG to pay a penalty of $3.1 million plus costs for breaches of the Commerce Act. Kuehne + Nagel’s penalty brings the total penalties ordered in this case to $11.95 million ... More>>

ALSO:

Crown Accounts: Revenue Below Projections

Core Crown tax revenue has increased by $1.9 billion (or 5.0%) compared to the same time last year. However this was $1.1 billion less than expected and is reflected across most tax types, continuing the pattern of recent months. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news