Power changes would cost users $40 each

New Electricity Authority guidelines around pricing could leave Waitaki customers $40 worse off.

Network Waitaki chief executive Geoff Douch has criticised the changes to transmission pricing and said they will have a bad impact on a minority.

It submitted against the proposal and lobbied the Authority in Wellington when the guidelines were mooted in consultation form.

"We looked at it and said ‘this is going to have quite a negative impact on our customers’ — so we opposed some elements of it."

He said it would raise the amount Network Waitaki paid for use of the national grid. That would have a knock-on effect on its 13,000 customers. While he needed time to look at the full detail, he confirmed it would result in a roughly 3.5% increase per customer.

"That works out to be roughly $40 or $50 per year for the average residential power bill. Commercial customers will be different because they have a different pricing arrangement."

While the company would try to "absorb" some costs, he said prices were already below the national average.

The Electricity Authority announced the new guidelines on Wednesday and it expected the new approach to deliver significant benefits to consumers.

"The 2020 guidelines will give electricity consumers and generators much-improved signals of the cost and value of using the transmission grid.

They will stop overly high transmission charges for using electricity at times when consumers most want it and will stop rewarding parties that shift costs on to other consumers for no overall benefit."

PowerNet chief executive Jason Franklin, who manages a number of networks in the South, said the decision would have a limited impact on most of its customers, with the exception of Queenstown.

He confirmed 2000 customers in the Frankton area were provided via Electricity Southland Ltd, also known as the Lakeland Network.

It was projected they would receive a drop of $80 a year.

PowerNet supplied 37,000 in Southland, too; those charges could go up slightly — roughly $10 a year.

Electricity Invercargill Ltd supplied 17,000 customers and charges there were projected to decrease by slightly more than $20 a year.

The proposed changes will not be implemented until 2023.

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