Editorial: Just tell it straight

01:08, Jul 23 2013

We live in hydro power country.

Big lakes right on our doorstep. And canals. And power stations.

So electricity should be cheap here, right?

Wrong. Actually, it's not cheap anywhere.

But somehow here in South Canterbury power prices have gone up an average 4.4 per cent a year for the last five years.

That's higher than anywhere else in the country.


Why? Who knows?

But there's some good news. At least according to Energy Minister Simon Bridges, who, because his Labour Party counterpart David Parker was pointing fingers, pointed his back. The worst price spikes were in the last decade, he said, when Labour was in power.

And that's true, except it's a bit like the doctor saying he's going to cut off just one leg, not two. It's hardly consoling.

Finger-pointing aside, consumers are simply baffled by a supposedly competitive electricity market that for a decade produced average price rises of almost 8 per cent and for the last five at 4.4 per cent. And this when inflation was nothing near those figures.

Return us to the days of the Municipal Electricity Department when all we had to argue about was the South Island power price differential.


Mr Parker is arguing the pricing model should be changed, that we should average the cost of electricity into the market. I'm not exactly sure what that means, whether that be geographical or the mix of sources (hydro, geothermal, coal, wind, the next big thing) or through the year.

But whatever it means won't make much difference in the eyes of consumers who not only don't understand the wholesale market but who have long lost confidence in it.

They are told to shop around and while it is relatively easy to do so (if you have a computer) the different times in a year that companies review their charges means the cheapest supplier at a certain time is not the cheapest a few months later.

Can't they all be brought into line? And can't we have a clearer explanation of just why prices rise so regularly by so much?

Sure, Transpower is upgrading the national grid (aka big pylons) but it's not like there's a swag of new dams being built.

And nor is it like we've got much choice.

The present set-up is overly complicated and is not competitive.

How do we know? Because we live in hydro power country.

The Timaru Herald