Under new revenue limits announced by the Commerce Commission yesterday, lines company Aurora Energy is expected to recover up to $680.8 million in the four years from 2026, to be used for upgrading ageing network assets and meeting growing electricity demand across Otago.
Household electricity bills in Dunedin, Central Otago and Queenstown Lakes would increase by an average of about $15 a month, excluding GST, from April next year, followed by average increases of about $3 per month each year to 2030.
When including GST, this meant power bills would increase by an average of $331 by 2030.
Company critic and former Delta employee Richard Healey said the increase would be painful and had been predictable.
"This is going to be a real kick in the nuts for those people who are already struggling."
He said consumers had "effectively" been on a deferred payment scheme since 2021, when the commission capped Aurora’s revenue increases to about 10% each year.
The cap meant Aurora’s revenue came in below the recommended, asset-based revenue calculated by the commission, which was now being recovered through the new limits, Mr Healey said.
"I’m sure the fact that they have been getting a discount, which they will now have to pay, will come as a great surprise to the people who think their bills are already high.
"And the ones I feel really sorry for are the people in Central Otago."
In a submission on the draft changes, Federated Farmers Otago provincial executive member Simon Davies said few Central Otago members had experienced any noticeable improvement in reliability or quality of electricity supply to farms in the past five years.
He acknowledged delaying or dragging out investment was not viable as the network would only deteriorate and become more expensive to fix.
"Consequently, it is imperative that cost recovery for the work Aurora Energy is yet to undertake is fairly shared across their entire network.
"Those customers in Aurora’s Central Otago pricing regions should not have to bear the brunt."
Commerce commissioner Vhari McWha said it was in the long-term interests of consumers for Aurora to continue to upgrade its network.
"We are conscious of the impact on electricity bills across Otago and want to ensure Aurora Energy’s spending remains reasonable and limited to what is necessary," she said.
"To help reduce the initial price rise, we have smoothed the recovery of revenue across the four-year period."
The increase was an average across Dunedin, Central Otago and Queenstown Lakes. Actual increases would differ between consumers.
