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Home / Hawkes Bay Today

Little increase in power price

Catherine Gaffaney
By Catherine Gaffaney
Reporter·Hawkes Bay Today·
9 Oct, 2014 11:29 PM2 mins to read

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The average Napier household spent 28.8c kWh for power.

The average Napier household spent 28.8c kWh for power.

If you're paying more than 28.8 cents per kilowatt hour (kWh) for power, you're paying more than the average Napier resident.

The Ministry of Business, Innovation and Employment's latest quarterly survey of domestic electricity prices found the average Napier household spent 28.8c kWh for power.

This was a small increase from last year's average of 27.1c kWh and more than 5c kWh higher than five years ago.

Ten years ago, the average electricity cost was 17.9c kWh.

Electricity Authority chief executive Carl Hansen said higher transmission and distribution charges accounted for 72 per cent of power price increases in the past three years.

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"The higher transmission charges reflect substantial investment in upgrading the national transmission grid and the higher distribution charges reflect the Commerce Commission's view that most distributors were earning too low a return on capital," he said.

"The competitive part of the sector essentially covering generation and retailing activity accounted for 28 per cent of the rise in retail prices over the past three years."

From 2004 to 2011 it was a different story, with 69 per cent of power price increases due to competition in the retail power market.

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"A key driver of these increases were very sharp price rises for gas and coal, for example a 95 per cent increase in gas prices over the 2001-08 period," Mr Hansen said.

The Electricity Authority believed electricity prices would be relatively flat over the next few years, he said.

It would be difficult to know if the Auckland power crisis would affect regional prices, until the authority completed a review, he said. This review will be sent to Energy and Resources Minister Simon Bridges by the end of April next year.

Trustpower community relations manager Graeme Purches agreed government-driven power upgrades had increased line and transmission charges in the past six years, which had increased retail power prices slightly.

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Most retailers had reduced their margins because of competition, and households had become more energy efficient, he said.

Mr Purches believed the Auckland power crisis would not affect regional prices.

Consumers could keep their power bills down by using energy efficient lightbulbs and appliances, and insulating and ventilating their homes, Mr Purches said.

Households can check out whether they are on the best electricity price plan on www.whatsmynumber.org.nz and businesses can use www.switchme.co.nz

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