You are not permitted to download, save or email this image. Visit image gallery to purchase the image.
But, the regulator is warning that could cost more over the longer term because of the interest added to potential financing taken out by Aurora.
In June, Aurora applied to the Commerce Commission to increase household bills in Dunedin, Central Otago and Queenstown Lakes by between $240 and $360 over three years so it can generate enough revenue for the investment needed to make its dilapidated network safe and more reliable.
The regulator will have "public drop-in sessions" across the region asking for feedback to help it decide on key issues it has within Aurora’s plan.
Yesterday, it released the "key issues paper" - its first response since Aurora applied for the price increase (a customised price-quality path or CPP) in June.
The commission wants to hear what residents think about the length of the reinvestment programme (three years or five years), power cuts (planned and unplanned), the impact of Covid-19 as well as whether consumers have confidence in Aurora to deliver what it is proposing.
Associate commissioner John Crawford said they were considering ways of delaying an immediate price hike.
"For example, would they prefer prices to increase in gradual and steady increments or price increases to be smaller in the first year, followed by larger increases in the following years to give more time to prepare."
Deferring did not mean avoiding what needed to be paid to fix Aurora’s network, the commission said. It would mean adjusting "the profile" of price increases over time to make them more manageable and potentially using finance.
"In addition, any costs shifted into the future also incur an interest expense to reflect the higher cost of financing, so the total amount recovered from consumers will be higher as a result," the commission’s key issues paper said.
It would also have to consider what effect that option could have on Aurora’s financial stability and whether that changed its ability to fix its network.
The commission also said customers were going to get slightly more frequent and longer unplanned power cuts - about 111 minutes per customer per year - because of the continued failure of old equipment.
Aurora expects reliability in its network - if it goes ahead with its proposal - to improve by 2024.
The commission said it was interested to see whether customers would be happy to pay more now and get fewer and shorter power cuts.
Planned power cuts were also expected to remain at "high levels", but similar to the past two years, as the work on the network continued.
The Commerce Commission’s role was to assess Aurora’s investment plan to make sure it was justified and to decide what revenue it could take in, as well as what level of service it needed to offer.
It is expected to announce its draft decision on the Aurora proposal in November with a final decision on March 31 next year.
Otago public sessions
Dunedin August 6, 3pm-6.30pm The Dunedin Centre (room 2), 1 Harrop St
Alexandra August 10, 3pm-6.30pm Alexandra Community Centre, 15 Skird St
Cromwell August 11, 3pm-6.30pm Cromwell & Districts Presbyterian Church, 10 Elspeth St
Wanaka August 12, 3pm-6.30pm Lake Wanaka Centre, 89 Ardmore St
Queenstown August 13, 3pm-6.30pm St Andrew’s Presbyterian Hall, 26 Stanley St