Rising Energy Costs Could Cripple New Zealand

Wednesday 21 Jan 2004 Ken Shirley Press Releases -- Energy

ACT New Zealand Deputy Leader and Energy Spokesman Ken Shirley today slammed the Labour Government for its incompetent handling of the energy sector.

"While in Opposition, Labour criticised the deregulation of the energy sector and condemned the market model," Mr Shirley said.

"Yet, through the 1990's, New Zealand enjoyed declining costs for energy in real terms - with price competition favouring both the industrial processing sector and the domestic user.

"Since becoming Government, however, Labour's interventionist policies have led to regional State-owned monopolies in generation, with price gouging and a lack of commitment to investment.

"The Government's three State-owned energy generators returned record gross annual profits for the 2002/03 year - Mighty River Power $127 million, Genesis $105 million and Meridian $172 million.

"New Zealand industry and domestic consumers have cause for alarm when the Government continues to price gouge - reaping huge dividend payments while, at the same time, increasing prices.

"Any generation shortage is of Labour's making. Its foolish adherence to the Kyoto Protocol can only add to our energy costs, while precluding the use of our coal resources - which are our best option over the next 20 years following the demise of the substantial Maui gas field.

"Labour's policies have also prevented other generation schemes, such as the Trustpower 65 megawatt Arnold River project, with Government refusing to allow the scheme to proceed because of its location on DoC land.

"Energy Minister Pete Hodgson is transfixed with renewables - such as wind power - and, while these can be part of a mix, they will never provide the base load to meet New Zealand's needs," Mr Shirley said.

ENDS

For more information visit ACT online at http://www.act.org.nz or contact the ACT Parliamentary Office at act@parliament.govt.nz.

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