Power to the people - the energy trust election

Bernard Orsman answers questions about the politics of the trust that owns three-quarters of electricity giant Vector:

What is the Auckland Energy Consumer Trust?

A group of five elected trustees who dished out cheques for $310 last month to 290,000 power users in Auckland, Manukau and Papakura. The largest publicly owned community trust in New Zealand, it owns 75.1 per cent of powerlines company Vector.

The trust receives an annual dividend from Vector and distributes it to consumers. In past years it has done this through a credit on power bills. Last year's credit was $180. With a higher dividend of $310 this year, the trust decided to pay by cheque.

What is Vector?

A huge power company with assets of nearly $6 billion. It began as the Auckland Electric-Power Board and is now one of the top 10 companies. In 2002 Vector bought Wellington-centred UnitedNetworks for $1.5 billion, expanding the business to Waitakere, the North Shore, Rodney and Wellington. Last year, the trust agreed to a share float of 24.9 per cent of Vector to pay for the takeover of gas lines company NGC. Vector has 663,000 clients in Auckland and Wellington.

Why didn't all Auckland users get $310?

Only consumers from the old Auckland Electric-Power Board qualify for the cash dividend, ie Auckland, Manukau and parts of Papakura. Waitakere and North Shore consumers sold their assets in the old Waitemata Power Board for a one-off windfall. The assets were bought by United States company UnitedNetworks and later by Vector. What this means is that profits from Waitakere and North Shore go to Auckland, Manukau and Papakura consumers, who kept their powerlines in public ownership.

Could Vector be privatised and consumers lose their annual dividend?

Yes, and no. Privatisation has always been a hot election issue since the trust was formed in 1993. The centre-right ticket, C&R Now, won four of the five seats at the last election with the campaign slogan "Keep Vector in public hands". However, it did not rule out a sale of up to 24.9 per cent of the company and, while the four C&R Now trustees were split on the sale, it went through.

This election C&R Now is promising to "retain the AECT's 75.1 per cent shareholding of Vector". Leader Warren Kyd said: "Our policy is not to dilute the shareholding."

What do the Powerlynk and Just Power tickets say about privatisation?

The centre-left Powerlynk ticket is adamant it has never supported nor would support privatisation or a sell-down of Vector. Leader Shale Chambers said: "We mean it and we have guaranteed it." Chambers voted against the 24.9 per cent sale.

Just Power says it will not support a further sale of Vector shares beyond 75.1 per cent. Leader John Collinge, while not philosophically opposed to privatisation of power assets in "appropriate circumstances", has a record of opposing privatisation of Vector, including last year's partial privatisation because it was inappropriate to buy "speculative gas assets".

What do the independent candidates say about privatisation?

By and large they oppose further privatisation, although former Vector board member and veteran power consultant Bryan Leyland wants to wind up the trust by giving half the shares, worth about $3500 each, to consumers and the other half to the Auckland, Manukau and Papakura councils.

Why has former C&R Now trustee John Collinge set up a rival ticket?

Shifting political allegiances are nothing new on the trust. Bad blood between Mr Collinge and his C&R Now colleagues has resulted in the formation of Just Power.

C&R Now leader Warren Kyd said the ticket was Mr Collinge's "revenge" for wanting to kill off C&R Now by splitting the centre-right vote. Mr Collinge said it was spurious to suggest he was out for revenge.

Just Power was about getting people elected with huge expertise in energy and ridding the trust of the "fractious political nonsense" that had marred it for years. Furthermore, he said Just Power was as much about taking votes from the left-leaning Powerlynk ticket. What other issues have popped up?

The three main tickets talk about more undergrounding of unsightly lines, but in fact the $10 million budget (now linked to inflation) is unlikely to grow by much. Vector pays the bill and its private shareholders will not wish to prettify Auckland for no return.

Just Power is also making a meal of high meeting fees and promising to stop the practice of appointing trustees to Vector's board - although Mr Collinge was a board member and deputy chairman while a trustee.

HOW TO VOTE

* Voting documents for the postal election go out today.

* Vote for up to five candidates.

* Return voting documents to the returning officer using the pre-paid envelope provided.

* Voting documents can also be hand delivered to ballot boxes at the Returning Office on the ground floor of Bledisloe House, 24 Wellesley St West, Auckland; Manukau City Council office reception area, Wiri Station Rd, Manukau; and Papakura District Council office, 35 Coles Rd, Papakura.

* Voting documents must be in the hands of the returning officer by 5pm on October 27.

MEET THE CANDIDATES

Citizens & Ratepayers Now

* Michael Buczkowski: sitting trustee, electrical engineer and former manager director of Hirepool. Epsom resident.

* William Cairns: mortgage broker and former Auckland City councillor. Epsom resident.

* James Carmichael: engineer and director of Malaysian power company Ranhill Power Berhad. Newmarket resident.

* Warren Kyd: trust chairman, former National MP who chaired select committee for Max Bradford's electricity reforms. Manurewa resident.

* Karen Sherry: sitting trustee, Vector board member, lawyer and deputy chair of Energy Trusts New Zealand. Sandringham resident.

* Political leaning: Centre-right

* Policy platform: "Retain the AECT's current 75.1 per cent controlling shareholding of Vector." Increase dividends, improve security and quality of power supply, maintain the lowest possible line charges, continue and enhance the undergrounding of power lines, strong governance and financial management, act responsibly to maximise the value of Vector.

* 2003 promise: "Keep Vector in Public Hands"(while not ruling out privatising up to 24.9 per cent)

* What happened: Warren Kyd and Karen Sherry voted to sell 24.9 per cent of Vector in July 2005 and sale went through on Kyd's casting vote. C&R Now trustee Mike Buczkowski voted against the sale. A court order stopped rebel C&R Now trustee John Collinge from voting against the sale because he owned Vector capital bonds.

Just Power

* Philip Blain: Counties Power director, energy, electronics and telecommunications manager. Waiheke resident.

* Maurice Chatfield: accountant, asset manager trustee and trust expert. Greenlane resident.

* John Collinge: Sitting trustee, former chairman Auckland Electric Power Board, former Vector deputy chairman and former National Party president. St Marys Bay resident.

* John Coutts: Production engineer and information technology expert. Former president New Zealand Institute of Production Engineers. Orakei resident.

* Tom Leong: Electrical engineer. Former president Electrical Engineers Association of New Zealand and former deputy chief executive Wairarapa Electricity. Pakuranga resident.

* Political leaning: Centre-right.

* Policy platform: "Just Power will not sell consumers' shares in Vector." Concentrate on protecting electricity supply and dividend and not on speculative investments, keep energy price rises fair, will not appoint trustees directors of Vector, cut the costs of the trust and reduce trustee fees, spend more on undergrounding.

* 2003 promise: Just Power is a new ticket headed by former C&R Now leader John Collinge. He opposed the 24.9 per cent sale of Vector in July last year.

Powerlynk

* Steve Bayliss: Managing director of solar company SunPower and former Papakura district councillor. Papakura resident.

* Shale Chambers: Sitting trustee, Vector board member, MetService director and lawyer. Mt Eden resident.

* Kelly-Ann Harvey: Institute of Directors manager, Waiheke Community Board deputy chair. Waiheke Island resident.

* Simon Mitchell: Barrister and chairman of the New Zealand chapter of the Education Law Association. Former Land Transport Safety Authority board member. Mt Eden resident.

* Stuart Nash: Director of strategic development at AUT University and director for New Zealand China Trade Link. Labour Party candidate for Epsom 2005. Remuera resident.

* Political leaning: Centre-left.

* Policy platform: "Powerlynk won't dismantle your trust, privatise or sell Vector, allow foreign ownership of your power lines." Guarantee the power dividend, ensure world-class security of power supply, promote low power prices, ensure sound and open governance of the trust and Vector, increase undergrounding of power lines, protect Auckland's energy infrastructure, support energy conservation projects.

* 2003 promise: "To keep our power lines 100 per cent."

* What happened: Shale Chambers voted against the 24.9 per cent sale of Vector.

Independents

* Former Vector board member Bryan Leyland is one of five independents vying for the five trustees spots on the Auckland Energy Consumer Trust. A power industry consultant with 50 years' experience in the electricity industry, he is alone among the 20 candidates seeking to wind up the trust. He wants to split the trust between the 290,000 consumer shareholders - who would get shares worth about $3500 each - and the Auckland, Manukau and Papakura councils, the long-term capital beneficiaries. "The trust has demonstrated time and time again an inability to act in the best interests of Vector and the consumers of Auckland. The trust has outlived its usefulness and consideration needs to be given to terminating it," said Mr Leyland, who lives in Pt Chevalier.

* Software company businessman and Manukau resident Uluomato'otua Aiono wants to use the trust's resources to do more about energy alternatives such as gas and solar heating and promote energy-efficient solutions such as insulation. Otherwise rising prices will further burden, even cripple families.

* Company director Julian Fairlie said he was keen to ensure the trust's assets stayed with the Auckland consumers. The Glendowie resident, who lists environmental protection among his interests, said although lower electricity prices may seem desirable, greater efficiency in the use of electricity would always bring a better economic benefit to the community.

* Ports of Auckland worker Harry Palmer also promises to keep the assets of the trust with the people of Auckland. The Mt Roskill resident and conservationist said independent candidates would make good trustees.

* Bank officer and Papakura resident Rao Anupindi said he would strive for the welfare and benefit of trust members.