OPINION: Pete Fowler from the sausage capital of New Zealand hasn't quite got it right when he praises the smart meters (Times, Jan 28).
First, the generation companies can sell power only at wholesale rates to power firms that onsell it to us, the consumers.
So by spilling water, or saying there is not enough, the wholesalers can control the market.
This wholesale market is a dynamic thing and the wholesale unit price can see-saw according to when and where the demand is occurring.
This spot-price, as it is known, is not well liked by the retail supply companies because as it fluctuates it affects their profits on their product because they are required to sell it to us at a fixed price.
So along comes the "smart meter".
These cunning devices actually allow the retail power companies to maintain their desired profit irrespective of the spot-price. They are radio-controlled and the power company can change the tariff/kilowatt on your meter at will.
One thing you can be sure of is that you will pay more if their purchase price goes up but never less than the unit price agreed to in your contract.
Just as an aside, I wonder if the power users at Tiwai have smart meters? Indeed, it is a win-win situation, but not for the end-user.
- The Southland Times
What is your favourite part of the south in summer?Related story: (See story)