Mayor slams proposed power price hikes

Jim Boult
Jim Boult
More Queenstown residents could be thrown into "power poverty" with "cold, dark homes" under proposals by Aurora Energy, the mayor has said.

Queenstown Lakes Mayor Jim Boult has drafted a letter to be put before an extraordinary council meeting tomorrow that heavily criticised plans by the energy company to upgrade the power network at the cost of higher bills.

He dismissed the plan as "unaffordable" and "short-term", and said the price hike would disproportionately hit the Queenstown Lakes district at a time when Covid-19 meant people were struggling.

"An extraordinary projected increase of 48%-66% in monthly distribution charges for residential customers is unaffordable and untenable."

As previously reported, the current proposal is to raise residential bills across Dunedin, Central Otago and Queenstown Lakes by about $20-$30 a month.

If approved, the letter was to be sent to the Commerce Commission ahead of the regulator setting the price structure for April 2021 onward.

The submission included recommendations to offset or delay the bill increases through government help, loans or targeted use of the $5million fine Aurora Energy received in March.

It also suggested moving from a three-year pricing plan to a five-year one, so customers could consider investing in better insulation or self-generate using solar power.

Mr Boult further said the Aurora Energy investment plan failed to account for an expected growth in population across the Queenstown and Wanaka area.

He said outages would be caused, and that a recent outage in neighbouring Clyde had left residents in -10degC temperatures.

The paper also referred to a 2019 council survey that found 15% of the community struggled to heat their homes, and that 70% of those affected cited cost as the issue.

"Projected increases will severely impact Aurora’s projected revenue as more members of our community are forced to occupy cold, dark homes."

Mr Boult added that inadequate power coverage could affect the skifields’ reputations.

Aurora Energy, which is owned by the Dunedin City Council and Dunedin City Holdings Ltd, has said customers were historically charged low prices and so the price hikes were to pay for $383million worth of upgrades needed to avoid power shortages.

Mr Boult said no community would advocate for under-investment that led to an unsafe network and called for a permanent customer panel to ensure the same mistake was not made again.

An Aurora Energy spokesman said the firm "greatly appreciated" the feedback from the Queenstown Lakes District Council.

Aurora had taken heed of previous comments from the council when it produced a revised proposal in June, the spokesman said.

"A consistent theme has been that customers agreed that essential work was necessary, but were concerned about the proposed price increase and we had those views clearly in mind as we finalised our proposal."

Businesses in Queenstown would pay on average $492 more in line charges over three years under the energy firm’s proposed price plan.

Those in Dunedin would pay $636 and in Central Otago $588.

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