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Norman: Empowering New Zealand

Empowering New Zealand

Dr Russel Norman launch speech, 18 April 2013

The Green Party is providing all New Zealanders with a positive vision of a fairer, more efficient and greener energy future.

Our plan is for all New Zealanders.

Our plan will save Kiwi’s money and result in cleaner energy.

Our plan puts the shared interests of all New Zealand ahead of the private profit interests of a small number of shareholders.

It is heartening that our vision is broadly shared with the Labour Party, and we are glad to be jointly making this announcement today.

Critical components of our plan neatly align with the Labour Party plan. That is a good thing.

That means New Zealanders can be assured that the Green Party and the Labour Party working together will deliver households cheaper power bills and are offering compatible, if not identical policies.

You could say great minds think alike, we prefer to think it highlights that the changes that are needed are obvious and urgent.

New Zealanders have been paying too much for electricity for too long.

In the past twenty years, electricity prices in New Zealand have risen by seventy percent in real terms, while they have fallen on average by six percent across the OECD.

The problem is that all generators are paid at the cost of running the most expensive power plants.

Even though most of our power plants were built decades ago with public money and cost less than a cent a kilowatt hour to run, their owners pocket more than 10 times that amount.

That’s led to the electricity companies increasing their valuations by billions of dollars, which, in turn, justifies further price hikes.

And the price hikes are set to continue with Contact signalling more increases on the way to pay for larger dividends, and there will also be pressure from shareholders in any newly partially privatised electricity companies.

All the major players in the electricity market are motivated by profits and higher prices. Governments and private investors have used the electricity market as a stealth tax on our economy and have pocketed billions of dollars.

It is time for someone to stand up for families and businesses who want a fair deal and cheaper power bills.

It is time for someone to stand up for the environment and drive up the use of renewable energy.

It is time for someone to plan for energy efficiency and coordinate the better use of our available power.

Today the Green Party is stepping forward. We are going to relegate excessive power profits at all costs to the past and build a better greener electricity sector for the future.

Our plan which I am launching today, called Empowering New Zealand, has three components that will deliver New Zealanders cheaper and greener energy.

Firstly, establish a single buyer that will negotiate cheaper power prices for all of us

Secondly, deliver cheaper power by giving each household a block of low cost electricity every month

And third, strengthen the role of energy efficiency and green energy within our electricity system.

The common centrepiece of our plan and the Labour Party plan is a new Pharmac-style agency named NZ Power that pools the buying power of consumers into a single buyer that will be able to drive harder bargains with the generators and pass those savings on to families and businesses.

Ensuring affordable electricity for Kiwi families and businesses is more important than protecting the excessive profits of power company owners.

NZ Power will work for electricity customers, not for profit.

If you think about Tiwai Point smelter and the negotiating power they have been able to exercise with Meridian Energy over the years, and multiply that many times over you can see the potential for significantly cheaper power.

NZ Power will act in the common good to get the best deal for households. It will use its size and market position to deliver for households.

Businesses will also benefit from the lower wholesale price of power being passed on by retailers.

But just getting cheaper power is not enough, unless it is shared equally.

We believe our energy prosperity needs to be shared with all New Zealanders, not just the few who own a power company.

Where National would deliver a profit dividend to shareholders, we will deliver affordable power to every household through allocating a low-cost block of electricity to households each month.

The Green Party supports the introduction of a progressive pricing system to make NZ Power work for households.

Under our model we would require NZ Power to pass on the savings they negotiate in the form of a low-cost block of electricity to each household each month and lower prices to business.

Our calculations show this will save families around $300 a year.

Given that power bills have gone up around $100 on average over the past year and have gone up over $300 since National came to power - that is a big saving for families.

Delivering for families and businesses is important. But we also want to capture this opportunity to deliver for the environment.

One hundred percent renewable is within our reach. New Zealand is uniquely placed to move rapidly to near total use of renewables for electricity generation.

We can also capture greater energy efficiencies in the system through more effective management of the power we already generate.

We would mandate NZ Power to facilitate energy efficiency, and in their planning role work alongside power companies and local communities to move New Zealand towards a higher use of renewable energy.

The Greens Energy Spokesperson Gareth Hughes and I have been meeting with lines companies, retailers, and micro-generators to discuss other reforms to improve innovation, resilience, and affordability in our electricity sector and we would look to do much more in this area to deliver on our clean green potential.

NZ Power will act in the interests of our environment by steering us towards a cleaner, greener energy future rather than leaving generation decisions to profit hungry private companies.

This plan means New Zealanders now have a real choice about our energy future.

Our vision is poles apart from the National Party’s 20 years of market failure.

Ensuring affordable electricity for Kiwi families and businesses is more important than protecting the excessive profits of power company owners.

The status quo delivers for the few, our changes deliver to the many.

The status quo disempowers the individual household, our proposals empower households to collectively force the electricity companies to give us better prices.

It is time for a better energy future and we are committed to delivering it.

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