Christchurch power company Orion has asked the Commerce
Commission for permission to hike prices by 5 per cent to
recover earthquake rebuild costs.
The firm wants to revamp its electricity network which was
damaged in the devastating Canterbury 2010 and 2011
earthquakes and put in high voltage underground cables,
overheard lines and pylons, and new substations.
But they want consumers to pay for it, with the upgrade
estimated to cost households an extra $1000 over the next 10
years - or on average $8.70 a month, from April next year.
"As a result of our final calculations, the figure of $8.70
is slightly higher than the $8.50 communicated in our draft
proposal last year," Orion chief executive Rob Jamieson said.
The proposed changes do not include annual inflation
adjustments, which would be additional.
The commission now has 40 days to evaluate Orion's proposal.
If accepted, the commission will thoroughly analyse the
application and undertake formal public consultation before
making a final decision later this year.
Thirty eight submissions were received after Orion's request
"We're very grateful for the feedback and have reviewed it
thoroughly. It's clear that people want us to restore a good
quality electricity system," Mr Jamieson said.
"We found there was good support for our proposal to restore
the network, spread the cost of doing so over time and
recover costs from power consumers.
"Some submitters suggested that the costs should be met by a
range of parties, such as our council shareholders and the
Only a small number suggested that prices shouldn't go up at
all, Orion claims, but stressed they have to consider the
"long term interests of our region".
"We think it's fair to recover our reasonable costs from the
consumers who use, and benefit from, our service," Mr
"The proposed prices provide no more than a fair return and
provide the right incentives for us to continue to make sound
investments in a strong, essential electricity network for
the good of our community."
Orion has today posted its 2000-page proposal, including
public comment it has received, online at www.oriongroup.co.nz/cpp