Energy industry explained

An energy industry expert met with the Turangi/Tongariro Community Board this week to lessen confusion caused by the two invoices each of the area's electricity users receive every month.

Brian Gurney, chairman of both the King Country Electric Power Trust and King Country Energy's board of directors, made a presentation in which he explained the structure of the local energy industry.

Mr Gurney described the roles of the local energy generator (King Country Energy) and the company who deliver the electricity (The Lines Company). The government’s Electricity Reform Act 1998 requires the separation of the lines network operations from the retailing and generating functions.

"We recognise that the local energy industry is complex and difficult for many to understand," he said, acknowledging that two invoices did cause confusion for many local customers.

 

In many other areas of New Zealand, electricity consumers receive one combined invoice for power and delivery, but Mr Gurney believes this results in a lack of transparency in where costs are going. He stated that other lines companies of significant size are considering the move to separate billing for power and supply.

Despite the two invoices, local electricity customers are receiving an overall energy service which is among the cheapest in New Zealand. King Country Energy is currently ranked eighth cheapest energy retailer out of 28 in New Zealand, and The Lines Company is ranked seventh cheapest out of the country's 27 lines companies.

As well as the two commercial companies, the industry also includes the King Country Electric Power Trust, which was established in 1993. Any consumer connected to the lines company network is a beneficiary of the Trust. Mr Gurney said the Trust owns 20 percent of King Country Energy and 10 percent of The Lines Company. Based on its current income, the Trust projects a possible annual distribution of $1.8 million to be shared among its 10,000-odd beneficiaries.

Councillor Don Ormsby and fellow Turangi/Tongariro Community Board members appreciated Mr Gurney sharing his expertise. "Nobody likes paying bills and when there are more bills than expected, people can begin to get bewildered," said Cr Ormsby.

"After hearing Mr Gurney’s presentation, I feel confident that I can assure our residents they are not paying more than necessary. In fact, the energy tariffs we pay are amongst the cheapest in New Zealand. Anyone who would like a layman's explanation of the situation should contact any of the Community Board representatives," he said.