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Attacks on household energy investment

Attacks on household energy investment aim to keep consumers captive to the electricity industry

The Electricity Authority is pushing New Zealanders to become captives to the electricity industry. Its policies are protecting monopolistic lines companies, but failing to protect domestic consumers.

This is behind the much-publicised attempts by both lines companies and retailers to make rooftop solar systems uneconomic. They aim to protect their revenues and profits from reduction in electricity demand caused by the potentially widespread investment by consumers in solar energy.

The Electricity Authority says the money saved by people who install rooftop solar must be made up by people who can’t afford to invest. They say lines companies have a right to their expected return on investment – but consumers do not.

New Zealand regulation is unique in the world in the way it protects investors at the expense of consumers.

Electricity investment models indicate that the more solar generation consumers install, the more gas-fired peaking stations will be needed to build to provide the winter peaking that solar cannot supply. Therefore, they say, solar energy means more, not less, greenhouse emissions once these gas-fired stations are built.

But home heating with wood is excluded from the models. Wood burners provide exactly that winter peaking energy - from an affordable and completely renewable resource.

Log burners have been suppressed for a decade by air quality plans that begin with the premise that we must remove log burners to clean up smog. This is then “proven” with health impact studies which are highly debatable, and with wood burner standards that exclude new-technology down-draft burners that are reliably smokeless.

Wood burners supplied 45% of the useful space and water heat in New Zealand’s houses in 2005. Wood burners were preferred over heat pumps by 70% of customers who used government’s Clean Heat Subsidy.

Now that subsidy has ended, The air quality standards are leading to all-electric houses that make us captive to the electricity industry, requiring new peaking power stations to meet winter peak loads. Wood-fired heating has declined to a mere 12% in 2015.

The Electricity Authority says power prices must rise by 10% in 10 years to maintain lines company profits, unless new pricing is set in place to make solar rooftops uneconomic. This is incredible! – it reinforces electricity’s near-monopoly over household energy supply.

Clean wood burning threatens that monopoly. So does the occasional use of older wood burners on the coldest days. These could make new peaking stations unnecessary, and significantly reduce electricity demand and greenhouse emissions. And communities would be far more resilient in the face of storms and blackouts arising from climate change.

What is uneconomic is not solar rooftops or wood burners, but the new power stations and transmission lines that were built long before they were needed. Transpower’s billion-dollar giant pylon project will probably never be used to its capacity.

A return to efficient wood burning requires a change to air quality standards. This would benefit householders, but reduce growth in electricity assets. It is a true struggle between consumers and the power companies favoured by Government policy and regulation.

Power prices are higher than the market will bear. Until New Zealand changes its laws, to protect consumers against monopolistic pricing, those who can afford it will invest to reduce their power bills. Those who cannot afford to invest will suffer energy poverty.


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