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CRT And Meridian Misled Public Says Trustpower


Combined Rural Traders and State owned electricity retailer eridian should be hanging their heads in shame as a result of the recent electricity pricing debacle involving Otago MP Gavin Herlihy, according to electricity retailer TrustPower.

TrustPower's Community Relations Manager, Graeme Purches, said that TrustPower had no alternative but to increase prices in Otago as a direct the result of the electricity reforms, and had been open and honest about that. He said the fact that the prices offered by CRT and Meridian were higher than those of TrustPower, even after price increases, confirmed that TrustPower had been right on this all along.

"Our concern is that in this environment CRT and Meridian, in what appears to be a classic case of opportunist marketing, cobbled together pricing information that the average consumer had no ability to translate, and which gave them no idea of the delivered cost of electricity into their homes. The fact that Mr Herlihy, who has a background as a past director of Central Electric

misinterpreted the information speaks for itself," Mr Purches said. "We have had customers telling us that when they enquired, Meridian told them to ring their local lines company to get pricing information, and in one case directed them to the wrong lines company anyway."

Mr Purches said an even more worrying aspect of the incident was the fact that neither CRT or Meridian had made any attempt to correct the situation.

"CRT and Meridian should have known last Saturday that Mr Herlihy had got it badly wrong. Yet even as late as Tuesday night they had made no attempt to either rescue him from his predicament or correct the public misinformation that had resulted. That sort of behaviour may well be acceptable to some, but I suspect most rural New Zealanders will find it abhorrent."

Mr Purches said TrustPower was also concerned about the behaviour of CRT in recommending a retailer to its members, without having made any effort to determine which company could provide the best deal, and its focus on promoting Meridian's Government ownership and South Island generation.

Mr Purches said TrustPower was a majority New Zealand owned company. And unlike Meridian, which had transferred its operations from the Waitaki Valley to palatial premises in downtown Christchurch, it had its offices in a rural area on the outskirts of Mount Maunganui. TrustPower had made direct investments of millions of dollars in retailing and generation throughout provincial and rural areas in the South Island, with the proceeds going to local community owned companies for the benefit of their communities.

"We have domestic customer bases and employ meter readers in Otago, Westland, Buller, Marlborough, Nelson and Ashburton, have commercial customers throughout the South Island including Christchurch, Dunedin and Invercargill, and 23 of our 37 generation facilities are in the South Island. Even more importantly, those generation facilities are all comparatively small, with minimal environmental impact. In many cases they are integrated with local irrigation to maximise benefits to local farmers."

Mr Purches said TrustPower had from the outset argued that the electricity reforms would not result in cheaper power for New Zealanders in the short term, particularly for those in rural and provincial areas. However, the company believed competition was healthy, supported by the fact that prior to the latest round of reforms, 40 percent of TrustPower's revenue came from selling electricity competitively over other company's networks.

"Customers are increasingly being offered choices. In making those choices they should not be faced with having to decipher information that is poorly presented and misleading. If they are, they should make their choices accordingly, Mr Purches said.

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