Piped gas charges rise adds to Northlanders' rising cost of living

Jan Kini said rise in piped gas prices would further exacerbate the finances of those on fixed income like senior citizens. Photo / Michael Cunningham

There's no respite from the punishing cost of living for Northlanders, with piped natural gas charges the latest to rise at the worst of times.

The Commerce Commission has approved a phased increase for gas pipeline charges of about 3.8 per cent on average each year for four years across all household consumers in New Zealand.

For a typical annual household gas bill of about $1246, this would be an annual increase of about $48 or $190 over the next four years.

These figures do not include the impact of changes in other components of consumer gas bills, such as charges related to the price of wholesale gas. The impact on individual households, as well as commercial and major industrial users, will depend on their particular circumstances and arrangement with their natural gas supplier.

The changes come into effect from October 1.

"Our decision balances price rises for gas users with the need for gas pipeline businesses to continue to invest appropriately to maintain safe and reliable supply while there is still demand for natural gas," the commission said.

But Whangārei Grey Power president Jan Kini said an impending rise in piped gas prices would further exacerbate the finances of those on fixed income like senior citizens and pensioners.

"It's just dreadful. Power charges are the biggest cost and gas adds to the cost. Many of our 800 members are lucky to be able to cope but so many are struggling.

"Rates going up and the cost of living in general impacts on a lot of people."

Whangārei Age Concern president Beryl Wilkinson said any increase in the cost of heating would have an enormous impact for those on fixed income such as pensioners and superannuants.

"It adds to the cost of living and to poverty. The elderly are now turning off heaters more and more. Even the price of a loaf of bread for pensioners has gone up," she said.

From October, it will cost Northlanders on piped gas supply more for household essentials such as cooking. Photo / NZME

Already, she said freezing pensioners were rising early, rugging up and returning to bed in a desperate bid to stay warm this winter.

The commission's associate commissioner Vhari McWha said while the remaining life of the natural gas pipelines in New Zealand was likely to be shorter than previously expected, it remained an important transitional fuel and essential for many homes and businesses so investment would be required.

There are about 300,000 connections to the regulated natural gas networks in the North Island. The majority are residential users, alongside a smaller number of commercial and industrial users.

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Figures for Northland households and businesses connected to the gas pipeline were unavailable.

Under the Commerce Act, the commission limits the maximum revenue gas pipeline businesses can earn and sets the minimum quality standards businesses must meet.

The requirements for gas pipelines will be reviewed in four years, instead of the normal five. Four years is the shortest period the commission is allowed to set under the Act.