Mike's Minute: More bluster, or real change for the electricity sector?

We are apparently going to hear about major electricity sector reform from the Minister this coming week. 

The final touches are being sorted. 

Simon Watts calls them fundamental. He refers to the last time it was this major as being in the 90's. 

So are they going to split the gentailers? 

The Government's history would suggest no. They have been talking big on banks and supermarkets, and they've made plenty of announcements, but little has actually happened. 

Why would this be any different? 

This Government has also argued, rightly, that business likes consistency. When the last lot talked about Onslow and the lake and the hole in the ground, the industry stopped investing. 

So would splitting the big players not cause the same trouble? 

But in the report that is driving the Government's thinking we have seen an astonishing increase in the basic power bill. 

In 2021 we spent $4.4 billion. The next year was $4.5 billion. In 2023 we spent $4.8 billion on power bills. In 2024 it was $5.2 billion. 

So it's increased from $4.4 billion to 5.2 billion, and you wonder why you don’t have any spare cash. 

On average the basic household power bill since 2023 has gone up $400 each and every year. 

We can explain some of it on renewables. We need investment but we still haven't closed the gap. We still panic in winter, and that’s before you get to all the AI and data centres that will presumably suck us dry. 

By the way, on the renewable front, Contact Energy are looking at pulling more water out of Lake Hawea. That’s if they can get past the locals, who of course hate it. 

In that is part of the New Zealand problem – nimbyism. You can't moan about the bills and also moan about the solutions. 

Everyone wants utopia, but don’t want to pay for it, or have any of it happen in their backyard. 

So, stand by. Maybe it's fundamental, maybe it's a government looking to spin some more PR. 

I think though what we all agree on is we need more power, and the damage the current scenario is doing to the economy can't go on. 

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Episode Transcript

Speaker 1 (00:00):
We are apparently about to hear about major electricity sector
of form. This is coming from the minister. Final touches
apparently being sought of. But the announcement set, he says,
before the end of the month and given today is
the twenty second that means pretty much this week. I
guess we'll will inquire with the Prime Minister shortly. A
couple of things Simon Watts calls them fundamental. He refers
to the last time it was this major as being
in the nineties. So the question I would have thought

(00:22):
is are they going to split the gent tailors? I mean,
the government's history would suggest no. They've been talking big
on banks and supermarkets. They've made plenty of announcements, of course,
but little has actually happened. Why would this be any different?
So the government has also argued rightly that business likes consistency.
When the last lot talked about onslow, for example, in
the lake and the hole in the ground, the industry
stopped investing. So would splitting the big players not cause

(00:44):
the same sort of trouble. But in the report that's
driving the government's thinking, we have seen an astonishing increase
in your basic power bill. Now in twenty twenty one,
collectively we spent four point four billion dollars on power
any year four point four billion. Next year, it was
four point five. The time we got to twenty twenty three,
it's four point eight. By last year it was five

(01:04):
point two. So it's gone from four point four to
five point two billion dollars, and you wonder why we
don't have any spare cash. On average, the basic household
power bill since twenty twenty three has gone up four
hundred dollars each and every year, So we can explain
some of it renewables. Obviously we need investment, but we
still haven't closed that gap. We still panic in winter,
and that's before you get to all the AI and

(01:24):
the data centers that are presumably going to suck astride.
By the way, on the renewable front, Contact Energy are
looking at pulling more water out of Lake Harwire Well
that so then get past the locals who of course
hate it, and in that is part of the New
Zealand problem, isn't it nimbiism? You can't moan about the
bills and also moan about the solutions. Everyone wants utopia
but doesn't want to pay for it or have any

(01:45):
of it happen in their backyard, so stand by. Maybe
it's fundamental, maybe it's a government looking to spin some
more pr I don't know. We'll find out shortly. I
think though, what we all agree on is we need
more power and the damage the current scenario is doing
to the economy cannot go on. For more from The
Mic Asking Breakfast, listen live to News Talk Set B
from six am weekdays, or follow the podcast on iHeartRadio.