A government review aimed at improving the electricity market has been criticised by the Waitaki Power Trust because it will not reduce residential power prices.
The trust, which owns on behalf of the community all the shares in North Otago power lines company Network Waitaki, has made a submission on a preliminary review of the electricity market's performance, Improving Electricity Market Performance, prepared for the Government.
It considers issues relating to residential retail electricity prices have not been fully identified nor addressed by the review.
The residential sector had by far the highest rises in electricity prices from 2002 when compared with commercial and industrial consumers.
"Proposals [in the review] will not reduce residential electricity prices to a level which would prevent current prices being regarded as either profiteering or cross-subsidising cheap electricity for New Zealand industry," the trust said.
If change were to occur, the Government had few options available that would make a difference and be effective in reducing the price of electricity for residential consumers.
Options included specific instruction to its three state-owned generators and retail companies relating to profit margins, reducing the return on their assets and the level of retail price increases.
The trust recommended the Government, as a first step, act decisively and the electricity generators and retailers be instructed any increase in residential electricity prices must be approved by the Government.
The submission process has also been criticised by the trust, who said it conveyed the impression that recommendations in the review constituted the last word on how the market could be improved.
"Only those with a pre-determined agenda would accept that the recommendations for change in the discussion document are the only options worthy of consideration," the trust said.
The focus adopted by the review team had resulted in a "blinkered" interpretation, the trust said.
