Andrew Dickens: Is it time to split electricity gentailers?

Here we are in the middle of autumn, or is it the start of another winter of discontent? Because April the 1st is the time of scheduled price increases. All sorts of things are going up. The minimum wage goes up today, putting more pressure on small businesses. Thank you very much, at a time of pressure anyway, you're going to have to spend more on your wage bill. Meanwhile, the ACC earners' levy is going up to $1.75 for every $100 you earn from today. That is up from $1.57, up 11%. So you'll be paying 11% more of your wage into ACC than you were before. That is up to a limit of $156,000 or something like that. It's going to hit us all.  

But the one you're probably going to feel the most and the one that's getting the headlines today is your electricity bill. Electricity bills are rising nationwide. Line charges are increasing again from today. Average households will see a bill increasing by about $5 more every month. There's no single price increase. What households will actually see on their power bill will vary a lot depending on where you live, what plan you're on, and what retailer you're with. Some householders will see a small increase, some will see a large increase. Some are going to be hit by an extra $20 a month. Times that by 12 and see if you can afford that right now. 

Just a quick reminder, there are about 28 different lines companies in New Zealand. They all have their own lines charges, so this is why the prices change depending on where you are. Why you will pay in some cases $5 extra a month, that's the average, you might pay less than that, but you might pay up to $20 a month more for your line charges. There will be also a 5 to 10% increase in power bills this year anyway because of, you know, power. And that's on top of the 12% we saw last year. So all this you have to say is terrible timing. We're in an energy crisis when it comes to fossil fuels, that's already raging. So this just does not feel fair, does it? 

However, the Commerce Commission yesterday said the power price increase is justified. They need the money to improve the lines so that you can get the power into your house. So it's one of these scheduled increases that isn't dependent on the overall economy or how New Zealand Inc is doing, it's just things cost more. Terrible, terrible timing. The Commerce Commission yesterday said the power price increase is justified, but the Chair of the Commission said a little bit more. He said he hoped that something like electricity suppliers being split into generators and retailers would happen to create more competition. This is the quote from him: He said it's really important for us with our competition hat on to make sure that something a little bit like this happens, the splitting of the gentailers, so that the generators are not favouring their own retail arm when they're selling electricity, so that they can end out selling electricity at the lowest rate, the most competitive rate. 

Splitting the gentailers was announced as Winston's election policy this year. Now it's getting support from the Commerce Commission. So my question for you could be, should all political parties now accept that this is probably a good idea and crack on with it, and would you like to see that happen? 

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