POWER BILL RISE TIPPED TO HURT FOOD BUYS
26 June 2008
NAOMI MITCHELL
Contact Energy's Nelson customers face bigger power bills from next month, and budget advisers say that will affect the food-buying of already struggling families.
Contact sent a letter to customers this month saying it would raise power prices from July 1, citing its need to reflect the changing costs of supplying electricity.
Company spokeswoman Anne- Marie Shepherd told the Nelson Mail the average residential power bill would rise 9 percent.
The increase reflected the company's need to shift to more renewable energy sources such as wind- power, she said.
"Contact is investing $2.5 billion in such projects over the next five years, so our retail pricing needs to shift to reflect that investment."
Gas was still a major part of power generation in New Zealand and gas prices were also continuing to rise, she said.
For some Contact customers it will be the second increase within five months. In March prices were raised 7 percent because of higher costs charged by electricity distributor Network Tasman.
Nelson Budget Advice manager Marina Gosnell estimated the latest increase would cost the average household about $20 more a week.
She said many people would be forced to cut back on food budgets to cover the higher cost of power.
"People don't have anything else to move on."
Mortgage costs, petrol, power, rates and food bills were all rising and putting pressure on households. The budget service was seeing increasing numbers of people who needed assistance, she said.
"I can't remember a time when all the things seems to increase at once."
TrustPower community relations coordinator Pip Tschudin said the company increased charges as part of its annual price review in May, and was not planning any further rises.
Meridian Energy external relations manager Claire Shaw said the company was always reviewing prices and if it decided to change them it would notify customers first.
Genesis Energy public affairs manager Richard Gordon said the company was reviewing its pricing for customers in the Nelson region, and no decision had been made about whether prices would change.
Meanwhile, power bills could rise even further if the Electricity Commission has to buy reserve energy to make up for hydro-power shortages, the National Party says.
Energy spokesman Gerry Brownlee said last night a consultation paper showed the the commission might need another $50 million to buy power and between $55 million and $110 million for extra fuel to run the diesel generators at Whirinaki.
People wanting to compare power company charges can visit the Powerswitch website run by Consumer New Zealand at www.consumer.org.nz/powerswitch.
©2008 Fairfax New Zealand Limited. All Rights Reserved.
The Nelson Mail (NZ)
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