Media Release September 5th,
2000

Hand wringing and teeth gnashing over power shortages won't do

Where are the power pricing signals that encourage off peak electricity usage and conservation, asks Alasdair Thompson, the chief executive of the Employers and Manufacturers Association.

The Auckland region needs reliable power supply, and power pricing mechanisms to smoothen the peaks and troughs of electricity demand, he said. Mr Thompson was reacting to Transpower's warning that the north could suffer power shortages this summer.

"For years we have been promised power reforms would address these issues.

"There should be pricing rewards in place by now for businesses and private residences who can shift their power usage away from times of peak demand.

"If the phone companies do it for everyone, why aren't power companies?

"Time of use pricing would provide a direct market response to periods of power shortage and incentivise the efficient use of energy. So why haven't these been deployed?

"Wholesale market pricing from generating companies to retailers is not sufficient. Business and residential consumers too need time of use market prices they can respond to. This would shift peak loads into the troughs and give a clear signal in advance of when increased investment in generation capacity was required.

"Using energy efficiently makes good business sense providing its pricing recognises peaks and troughs in demand. If we had widespread time of use pricing the rewards for using energy efficiently would be increased dramatically.

"It's absolutely no use for the Minister with Responsibility for Auckland, Judith Tizard, to blame former energy Minister Max Bradford when the present Minister Pete Hodgson knows what must be done to deliver a reliable and efficient electricity supply market system.

"In nay event the EMA in conjunction with the Energy Efficiency and Conservation Authority is planning seminars to demonstrate how business can reduce its electricity costs through energy efficient practices and conservation without limiting their productive capacity."

Further comments: Alasdair Thompson tel 09 367 0911 (bus) 09 303 3951 (hme)

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