Power surge set to boost Government coffers

By CHRIS DANIELS

Government coffers may soon be filling faster than a hydro lake in spring, with the announcement of $265.2 million in dividends about to be paid by the electricity sector.

State-owned enterprises Meridian, Mighty River Power and Genesis, all formerly part of ECNZ, released details of their financial years to the end of June, as has Transpower, the SOE that owns and operates the national grid.

Except for Mighty River, all the SOEs are paying substantial dividends to the state, breathing life into claims that some were profiteering from high wholesale prices caused by low hydro lake levels.

All the companies reject this, with Meridian saying its result - $28 million ahead of budget - had been achieved by April, before wholesale prices surged. Meridian has only hydro generation, so was unable to take advantage of the high wholesale prices because it had to conserve its water stores.

Some of the worst of the winter is not reflected in the latest results, which go only to the end of June.

Mighty River Power says it made a profit of only $1 million over the winter, compared with $11 million the year before.

Because it has an even split between generation and retailing, high wholesale prices did not make much difference to its balance sheet.

State-Owned Enterprises Minister Mark Burton said Parliament had seen "some irrational attacks on the electricity SOEs" and the annual reports demonstrated that claims of profiteering were untrue.

Power companies had acted responsibly, protecting taxpayers' investment and securing supply, he said.

National MPs Murray McCully, (SOE spokesman) and Pansy Wong (energy) described the results as "merely the tip of the iceberg of windfall profits creamed during the electricity crisis".

Revenue for all the SOEs was well up, with each unit of power sold in the months to June worth much more than in the previous year.