Power cost seen in health

The electricity market is maximising profit at the cost of people's health, even while demand is declining, energy analyst Molly Melhuish says.

Meridian Energy has reported a 3% drop in energy usage in June compared with the same time last year, but says this does not mean power prices go down.

Lake levels were high in the North and South islands, following the highest June monthly inflows into Meridian's catchments in the past 10 years, Meridian said in its latest monthly operating report.

A warmer-than-usual winter, home insulation, and people cutting power use to save money were all factors in the decline, Mrs Melhuish said.

Figures out this week show electricity prices across the board rose 2.3% in the year ending March.

The lowest annual rise since 2001, it was evidence National's electricity market reforms had worked, Energy and Resources Minister Simon Bridges said.

People were using less electricity because they could not afford it, while the push for more home insulation was having an impact, Mrs Melhuish said.

She urged people to keep warm, because it was vital for health.

''Put keeping warm at the top of your list.

''If you have to use more power to keep warm enough so that you stay healthy and active, then just pay the difference and complain like mad.''

The impact on older people of high prices amounted to ''elder abuse''.

Other countries, with some exceptions, had seen the end of power price rises because of flat demand.

In New Zealand, the system was set up to extract as much from possible from customers.

Power companies were charging more than the market could bear, borne out by people reducing their usage.

It meant more people would get sick, while those who could afford it would improve insulation in their homes.

Mrs Melhuish warned Labour's policy to push higher-spec smart meters, in a bid to lower prices by encouraging appliances to run during the night, might not lead to lower prices.

''Until you change the objective of electricity pricing, which is now to allow profits to maximise, no technology will get around the fact that they will go on profiteering until they are told they can't.''

The value of dehumidifiers should be emphasised more, she believed.

They were relatively energy efficient, and made rooms more comfortable by reducing moisture.

''A dehumidifier will turn nasty moisture into nice heat.''

She suggested poverty action groups dehumidify people's homes with a high-capacity machine for a couple of weeks, after which a standard store-bought machine could be used.

Energy Efficiency and Conservation Authority senior technical adviser Christian Hoerning said dehumidifiers worked best in warm rooms.

The authority preferred people fixed the source of dampness, rather than running a dehumidifier, although they did have a place.

Green Party energy spokesman Gareth Hughes said power prices had risen above inflation.

''This is even less acceptable, given demand has been slack in the electricity market. It shows the market in its current form is not working.

''While the big power companies profit, families and businesses are hurting. Something has to change.

''Excessive electricity prices are a deadweight on our economy and a drain on strained family budgets.''

Meridian media manager Michelle Brooker said the South Island hydro storage lakes were 75% full. That compared with 73% the corresponding time last year.

Higher hydro flows did not translate to lower prices, although Meridian did not expect to increase electricity prices until at least June next year.

- Additional reporting: Rebecca Fox.

Power costs and continuing policy failure

Totally agree FwHam. National's power deregulation policy was supposed to reduce power costs and decrease inefficieny by providing competition. Max Bradford's reforms turned out to be nothing but more than increased profit and control for private power companies and shareholders at the expense of NZ consumers, the complete opposite to better power cost outcomes for consumers. Labour has done little to effectively reverse or counter Max's policy when in office to date.

The current government continues down a path of power asset fire sale privatisation simply now to balance its budgets. Not to improve the power cost outcomes for NZ consumers. The result of such policy can only lead to more powerful middlemen, higher power prices and less control of our country's resources. Most Kiwi's know this and voted against government policy in the referendum on asset sales. This referendum result should have been binding.

Do we remember when a kWh in NZ cost 1c? Kiwi's had real well-paid jobs with the NZED in some number. New Zealand's power system produced some of the cheapest power to consumers in the world.

This was never under the National / Labour neo-liberal system that of late has evolved. Yes, we need to look back and learn from past real governments who owned assets, operated, delivered cost effective services and provided employment. Muldoon's failed Think Big gamble, Bradfords power reforms and National's lack of a savings-based superannuation scheme all now contributing to real decline. These policy failures continue to impact on New Zealand's future. Short term polictical gain for long term pain continues.  [Abridged]




The government needs to get our assets back! The main function of government is to manage the country for the people who live here and the electricity experiment has been a total failure. There is no competition in the market. We are a captive market in so many areas as a small country. Only the government is willing to invest in the infrastructure for power generation so they should also manage it (like they used to when we could afford to heat ourselves).


Electricity market

In pre-Max Bradford days the New Zealand Electricity Department (NZED) provided an efficient and reliable service at very reasonable rates, as many around my age (83) will remember.

Today we have a multitude of electricity suppliers,  ancillary organisations etc., together with ever so many high salaried executives and other hangers on.
I wonder which have increased the most, efficiencies or costs? I would be surprised indeed if it were not the latter, in which case shouldn't we go back to the old system?


Over the last few years residental prices consistantly go up no matter the market conditions but corporate prices go down. Standard home owners are actually subsidising the business world, all while wages go up less than real world inflation of necessities.

It's time the government nationalised the industry and prices charge reflected cost of producing and transmitting and no more. Electricity is a must have for most people and shouldn't be a profit making excercise.

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