Pansy Wong National Energy Spokesperson

30 April 2001

Meddling Minister panics over looming hikes

The Minister of Energy Pete Hodgson needs to make up his mind about the pricing performance of electricity lines companies, National's Energy spokesperson Pansy Wong said today.

"In January he was encouraged by the lines companies behaviour, saying the Government's approach of industry self-regulation 'is nudging the industry in the right direction'. Now he has threatened the industry to 'go further if it wants to avoid regulation'. Let's not forget that he voted against National's legislation for price control over monopolistic lines companies."

Pansy Wong said Mr Hodgson's about-face outburst comes as the possibility of electricity price hikes for the coming winter loom.

"His threat is empty. In the current Electricity Industry Bill, there is no specific provision for fixed charges to be 10% or less of the power bill for an average domestic consumer as Mr Hodgson would have us believe. Caught in the middle, retail electricity suppliers are left to fend for themselves

. "The Minister claimed that the Electricity Industry Bill was set up to give the industry confidence that they would be left to self govern. But before the bill is even passed, political threats are already being made to try and compensate for the lack of action by the Minister over lines company charges.

"At the same time, the Minister's threats undermine the Commerce Commission which has been delegated the task of setting thresholds for the lines companies, with price controls used once thresholds are breached.

"National has voted against the introduction of the Bill because it will not reduce retail electricity prices. Increasing uncertainty in the industry because of political interference on a whim will threaten future investment.

"Mr Hodgson's latest comments only magnify the concerns," Pansy Wong said.

Ends

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