Power bills to rise up to 10pc

23:57, Feb 28 2013

Electricity bills are set to soar for Nelson and Tasman residents, with some facing a whopping 10 per cent rise.

This week Contact Energy is notifying its customers that they will have to pay more from April 1, with an average 9.7 per cent rise for its 18,000 residential customers in Network Tasman's area and 9.3 per cent for businesses.

An average household uses around 8000kwh of electricity a year, which costs about $1950, so they will have to pay an extra $190.

Both Network Tasman and Nelson Electricity have announced increases in line charges from April 1 and these will show up in household electricity bills when retailers decide their increases.

TrustPower, which has 4000 customers in Nelson city, will decide its next increase in June, and for its 5100 Tasman customers in August.

Meridian, which put up its prices in December, said it had no immediate plans to increase its energy charges but would pass on the network charges. Genesis also increased its prices in December and said it would review them again later in the year.


Just Energy said it would pass on the network price increase from April 1. In Nelson where it has 1182 customers that meant a 1.48 per cent rise, or about $3 a month, and in Tasman its 2271 customers would have a 3.7 per cent rise, or about $8.50 a month.

Budget Advice Nelson manager Marina Gosnell said the increased power charges were significant, and she expected to get a lot more clients having their power cut off.

She already has five clients who are so far behind in paying their bills their electricity has been disconnected and other power companies "don't want to know them".

Another Nelson resident, who was $500 in arrears for power, has for three months over summer used electricity only to boil a jug in an effort to save enough money to pay off the debt. Ms Gosnell said the resident cooked by gas, used candles at night and went swimming to bathe.

Network Tasman publicly notified its increase today which will add about $56 a year to the lines charges in a household bill, blaming it largely on Transpower, the state-owned enterprise which owns the national grid.

Transmission charges to 37,000 residential and commercial Network Tasman's customers would go up by about 30 per cent, adding about $48 to a typical domestic customer's annual power bill, said Network Tasman chief executive Wayne Mackey.

Network Tasman would increase its own distribution charges for its own customers by about 2 per cent, adding about $8 to a typical customer's bill. That makes a total $56 rise or by nearly 10 per cent for line costs for most consumers.

Mr Mackey said the increase was unfortunate, but the rise in transmission charges was out of his company's control.

Transpower had forecast major increases both this year and last year but Network Tasman had avoided the pain last year through lower than usual winter volumes.

"However this year the volumes are right back to normal levels effectively leaving us with two years of transmission bill increases."

Mr Mackey noted that Transpower was now well through a $2 billion upgrade of the national grid and that new investment was the key reason behind the rising transmission costs.

Nelson Electricity which distributes electricity to 9100 consumers will increase line charges by 4.6 per cent from April 1. For an average domestic consumer power bill using 8000kwh a year that would be an increase of 8 cents per day or 25 cents a month, said general manager Phil Goodall.

"While the line charges attributable to the costs of operating the local network are being held at the current levels, the cost of the transmission network provided by Transpower which accounts for 27 per cent of Nelson Electricity costs is increasing by 18 per cent for the year.

"Nelson Electricity is unable to absorb the additional transmission costs given it is spending up to $10 million on future proofing the distribution network through the replacement of the main substation at Haven Rd and installing an additional 33,000-volt sub-transmission cable back to Transpower's Stoke substation in Marsden Valley."

Ms Gosnell urged those struggling to pay their bills to pay for power, rent and food first, and put aside enough each week for power.

If you are struggling with your power bill, email chiefreporter@nelsonmail.co.nz or phone 03 546 2881.