Crisis index of cost to commercial sector

Electricity crisis index of cost to commercial sector – to 2 May 2003 lost manufacturing sales total $20.6 million

”The economic impact of the electricity market crisis to the industrial and commercial sector has reached at least $20.6 million in lost sales since 1 March due to forced demand reductions. In addition businesses that must continue supplying products and services to consumers have paid at least $14.2 million above the unit price paid by households for their power. The weekly survey consists of all MEUG members and an increasing number of medium and small enterprises affected by the crisis. The survey does not cover all manufacturers and commercial enterprises affected by the spot price crisis.

“Demand reductions by enterprises surveyed as a result of the spot price crisis since 1 March totals 90,000 MWh.

“For the week ending Friday 2nd May 2003 spot prices averaged 23 c/kWh at Haywards. The week before spot prices averaged 17.5 c/kWh and since 1 March spot prices have averaged 18 c/kWh. In comparison the energy cost of an average households power bill is about 7 c/kWh (and just over 13 c/kWh including line charges).

Ralph Matthes, Executive Director of the Major Electricity Users’ Group (MEUG), said, “delays in finalising metering data have resulted in delays in final spot prices being published which has partly lead to the delay in the week to last Fridays survey results.

“Last week saw average spot prices rise despite the voluntary savings campaign starting to have a higher public profile and the announcements by Genesis of being able to access some already contracted for gas earlier. The economic costs measured in this survey are becoming the tip of the iceberg as businesses and business confidence throughout the country is affected. The Government seems resolute to fix the problem without throwing the entire market out; that’s good news and we only caution that the devil is often in the detail - careful analysis and consultation will be needed to develop a robust solution or solutions.”

“The graphs on the next page summarise the lost sales and additional spot purchase costs from those surveyed by MEUG and the Haywards spot price relative to that paid by households since 1 March.

© Scoop Media