John Harbord: Major Electricity Users' Group Chair says Kiwis are grossly over-paying for power

The Major Electricity Users' Group says consumers are grossly over-paying for power.  

Electricity prices have risen over the years, both businesses and average citizens struggling to afford their power bills. 

Chair John Harbord told Ryan Bridge the companies are producing the same amount of electricity, while making record profits. 

LISTEN ABOVE 

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:00):
Sales for the electricity, gas, waste and water services industry
up thirty six percent in the June quarter. That's on
the same time last year. This is from stats end Z.
They put it down to the energy crunch. So no
rain for the lakes, it's cold, we're using more electricity.
The gas storage problem, the gas issue. It comes on
the back of the Windstone Pulp International closures yesterday. Two

(00:23):
hundred and thirty jobs have been lost there. John Harbard
is the Major Electricity Users Group chair. He's with us
this morning. John, Good morning, Good morning. Just wanted to
check with you. Are you aware of any new mills
or factories that are considering closure because of this problem.

Speaker 2 (00:42):
Look, I think it's there's a number of businesses that
are under enormous strain at the moment, and you know,
their ongoing operation is a matter of almost daily consideration.
I think the other thing we need to bear in
mind with Winstone Pulp is there's a lot of businesses
in that area that make their living supporting Winstone Pulp,
and so their future at the moment is highly uncertain

(01:03):
as well.

Speaker 1 (01:03):
Yeah, we're talking about essentially about the potential decimation of
entire towns, here you've got two hundred and thirty jobs,
but then you look at that that's probably one thousand
people in terms of family members, et cetera. You know
our Kerney data hei these have a population of two
thy three hundred.

Speaker 2 (01:23):
Yeah, it's absolutely devastating for that community, and I think
it really shines a light on how vulnerable that a
lot of our regional and provincial communities are two things
like rapidly escalating wholesale electricity prices that undermine the viability
of the businesses that they depend on.

Speaker 1 (01:44):
This thirty six percent increase this is for the gurn
Court on the same time last year for electricity, gas,
waste and wastewater services. Is that significant?

Speaker 2 (01:53):
Yeah, it's absolutely significant. To put another sort of way
of looking at it, Ryan is for the per we're
looking at starting in twenty sixteen. At that time, the
combined profits of the four gentailors was two hundred and
ninety seven million dollars. This year, the combined profits of
the for gent tailors is one billion and eighty five
million dollars. So we've seen a massive increase in the

(02:16):
amount of profit these companies are making and they're not
making any more. Electricity than they were eight years ago, so.

Speaker 1 (02:23):
We shouldn't have partially privatized them.

Speaker 2 (02:26):
Well, I think we certainly had an argument that the
partial privatization has exacerbated a pre existing problem. The Commerce
Commission back in two thousand and nine, so prior to
the partial float, found that New Zealanders were already paying
higher prices for electricity than they would if we had
a competitive market. And to give you a sense of

(02:48):
sort of what the scale of that is is sort
of between the electricity regulator, the electricity Authority and private
investment companies that have sort of looked at this with
their modeling tools. Because the estimate is New zeal And
consumers including households, are paying between one and two billion
dollars a year more than we should be for our electricity.

Speaker 1 (03:06):
Goodness me, John, thank you very much for that. Of course,
there's a task force that is currently looking at options.
We'll see how that goes over in Australia. As a
report earlier in the show, they are looking at nuclear,
you know, because you cannot rely on wind, solar and
hydro its intermittence, so you either need coal or gas
or nuclear. For more from News Talks B Listen Live

(03:30):
on air or online, and keep our shows with you
wherever you go with our podcast on iHeartRadio