Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search


Big power companies competing unfairly against local energy

Big power companies are competing unfairly against local energy

The big electricity companies consider solar energy “disruptive” and want pricing to suppress it. In contrast, advocates of local energy say that solar, energy efficiency, and other local energy solutions are the cheapest ways to reduce carbon emissions.

Now the electricity industry has declared its vision to double its generation capacity. They would reduce carbon emissions by replacing coal and gas fired power stations with wind and geothermal.

Who will pay for that? Householders now use 31% of delivered electricity but provide 46% of the industry’s revenues. The industry depends on their power bills.

The Low Fixed Charge Regulations have become a battleground. Lines companies say that today’s power pricing makes poor households subsidise rich ones that have invested in solar and energy efficiency and so have low power bills. They want all households to pay a fixed charge of around $2 per day. That is effectively a tax on households that can’t be evaded by using less electricity.

The Electricity Authority calls for increased “fixed-like” charges in transmission pricing. Prices would depend mostly on where you live, not how much you use or when. This again is like an “efficient tax” because it’s hard to evade.

Taxes on essential commodities have a centuries-long history. “Salt taxes” in France, India and China were extremely lucrative, but also widely despised and controversial.

In the same way, fixed charges are simply treating householders as cash cows. The big cross-subsidy is NOT poor householders to rich ones, but all householders subsidising expansion of the electricity industry. Householders are using less and less power, so high fixed charges are needed to maintain the companies’ revenue streams. The companies have been flush with cash for years, and want more of it to pay for their growth vision.

Regulators are supporting the industry’s growth vision. They take for granted the idea of “revenue requirement” which guarantees companies’ access to capital. High fixed charges allow per-kilowatt-hour charges to be cut, thus making energy efficiency and solar investments take longer to pay back. This is essentially predatory pricing.

The regulators are saying it’s economically efficient for consumers to use electricity without constraint. This drives growth in electricity infrastructure, looking backward in supporting centralised electricity. Instead they should be looking forward towards a more localised, diversified, resilient and equitable energy system.

Transpower recognises the benefits of consumers being rewarded for reducing their peak demands. It has bucked the economic ideology of the regulators, and recognises the benefits of solar and batteries in households. It is time to demand that the regulators accept such forward-looking engineering realities – that technical efficiency is more important than so-called “economic efficiency”.

Solar and other local energy solutions create fewer carbon emissions than the planned power station expansion, which includes six to eight new gas peaking power stations. They also make households more resilient to power outages, and create employment in communities. Local energy is very nearly carbon-zero.

The purpose of the 2004 Low Fixed Charge Regulations is to “assist low-use consumers and encourage energy conservation.” These needs have not changed, indeed they are more important than ever. Protecting the low user tariff is pivotal to creating a low-carbon and efficient energy sector and therefore economy.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Saudi Oil Refinery Crisis

So the US and the Saudis claim to have credible evidence that those Weapons of Oil Destruction came from Iran, their current bogey now that Saddam Hussein is no longer available.

Evidently, the world has learned nothing from the invasion of Iraq in 2003 when dodgy US intel was wheeled out to justify the invasion of Iraq, thereby giving birth to ISIS and causing the deaths of hundreds of thousands of people. More>>


PM To Japan, New York: Ardern To Meet Trump During UN Trip

“I’m looking forward to discussing a wide range of international and regional issues with President Trump, including our cooperation in the Pacific and the trade relationship between our countries." More>>

PM's Post-Cab: "A Way Forward"

At Monday's post-cabinet press conference, Prime Minister Jacinda Ardern announced a number of actions in response to the Labour Party's mishandling of sexual assault complaints. More>>


Gordon Campbell: On Allegations Of Left Wing Media Bias

“Left wing bias” accusations date back at least to the mid 1990s... The charge of left wing bias was ridiculous then, and is ridiculous now. More>>

Next Wave Of Reforms: Gun Registration And Licensing Changes Announced

“The Bill includes a register to track firearms and new offences and penalties that can be applied extraterritorially for illegal manufacture, trafficking, and for falsifying, removing, or altering markings – which are a new requirement under the Firearms Protocol.” More>>


Gordon Campbell: On Labour’s Mishandling Of The Alleged Sexual Assault

The focus of Labour’s alleged sexual assault scandal has now shifted from the party organisation to the Beehive... This is now a crisis of Beehive management and response, not something occurring at a distance within the party organisation. More>>


'History Rectified': Rua Kēnana To Be Pardoned

An official pardon for Tūhoe prophet and leader Rua Kēnana is one step closer after the Te Pire kia Unuhia te Hara kai Runga i a Rua Kēnana: Rua Kēnana Pardon Bill was read in Parliament for the first time today. More>>


Mental Health: Initial Mental Health And Wellbeing Commission Appointed

The Government has announced details of the initial Mental Health and Wellbeing Commission which will play a key role in driving better mental health in New Zealand. More>>


people outside the meeting house at WaitangiEducation: NZ History To Be Taught In All Schools

“We have listened carefully to the growing calls from New Zealanders to know more about our own history and identity. With this in mind it makes sense for the National Curriculum to make clear the expectation that our history is part of the local curriculum and marau ā kura in every school and kura,” Jacinda Ardern said. More>>


Sexual Assault Claims Mishandled: Labour Party President Resigns

Jacinda Ardern: “This morning I was provided some of the correspondence from complainants written to the party several months ago. It confirms that the allegations made were extremely serious, that the process caused complainants additional distress, and that ultimately, in my view, the party was never equipped to appropriately deal with the issue…" More>>





InfoPages News Channels