Company says it won't hike power costs
Network Tasman has received official approval to increase its distribution prices by 9 per cent but won't be doing so, chairman Ian Kearney said at the weekend.
The Commerce Commission has looked at distribution prices for 16 companies. It found that Nelson Electricity's price was set at the right level to align revenues with costs, but Network Tasman was 9 per cent under the allowable limit.
Mr Kearney said Network Tasman had stuck to a policy of keeping any price increases below inflation since 1998.
"The local economy is under pressure and local business and domestic consumers should benefit from our low-price, low-cost strategy.
"Our distribution prices are close to the lowest in New Zealand and we aim to keep them in this position."
He said Network Tasman would be paying a second discount to consumers this year, with about $4 million coming off December power bills.
In addition the Network Tasman Trust would distribute its annual dividend in December, a further $2.4m going to consumers.
The commission sets the maximum revenue a distribution company can earn in any one year. This maximum revenue is established through calculations aimed at providing a reasonable return on the company's assets for an efficient company.
It found that Vector should reduce its price by 10 per cent, and Horizon Energy Distribution by 3 per cent in the 2013-14 year.
Alpine Energy, Centralines, The Lines Company and Top Energy are all able to raise distribution prices by 10 per cent and may do so again the following year, to support investment in their networks.
The Nelson Mail