The Commerce Commission has evaluated the 2008-11 performance of all 29 electricity distributors.
Electricity distribution companies are accepting a “modest” Commerce Commission decision allowing them to set prices relative to inflation but the Major Electricity Users Group warns it may cause a biased precedent.
The decision is part of a process to address the way the country’s 29 electricity distribution companies set default prices – or price-quality (the maximum average price that lines companies can charge).
Electricity and gas distributor Vector is not out of the woods yet and is expecting tough economic conditions this year, chairman Michael Stiassny told shareholders today.
The NZX-listed company had maintained its investment grade credit ratings and had funds available for growth despite the credit crunch, he said.
The Commerce Commission is suggesting New Zealand’s electricity distribution companies should set default prices next year to match inflation.
Under changes to the Commerce Amendment Act in October 2008 lines companies, as suppliers to a market with little competition, are more regulated.
The Commission’s draft decisions paper on default price-quality (the maximum average price that lines companies can charge), to apply from April 2010, was released today and is the fourth paper under a process to address the way distribution companies set default prices.