The Press TUESDAY, FEBRUARY 16, 1965. Distribution Of Power

Press, Volume CIV, Issue 30676, 16 February 1965, Page 14

The Press TUESDAY, FEBRUARY 16, 1965. Distribution Of Power

The proposal of the Municipal Electricity Supply Authorities Association for reorganising the retail distribution of power is the most promising and practical yet put forward. It would reduce the number of supply organisations, without interfering with the long-standing rights of some territorial local bodies, by grouping them regionally with other territorial bodies. Power boards would then become redundant. Economies in engineering and administration would follow, and the anomalies that occur when neighbours have to pay different retail prices for electricity could be corrected. Presumably urban users might pay a fractionally higher price and rural users in the same region would pay a substantially lower price than they do now.

The proposed compensation for municipalities is recognition of the right of territorial local authorities in these groups to use electricity profits for general purposes. Since, in one way or another, this practice has long been tolerated and has recently acquired greater respectability through the failure of successive Governments to give local authorities a wider revenue base, the condition is not unreasonable. In effect it would mean that all residents, not only ratepayers, would make some contribution to local services. Ratepayers might get some small relief from that; but the general result would be the provision of more and better local services, rural as well as urban. In practice, no region would try to make a large profit because its local authority members would be too conscious of electoral opinion in favour of the lowest possible prices. Predictably, the Electric-Power Boards’ Association opposes the proposal. No doubt its members sincerely believe that their boards have not yet completed the specific task for which they were set up; but the fact is that power reticulation now covers most of the settled parts of New Zealand. Fewer and larger supply authorities are now needed; but they cannot easily be established against the opposition of territorial authorities determined to preserve their long-standing prescriptive rights. The simple course is for power boards to hand over their greatly changed responsibilities to regional authorities. The argument that either the Government or the regional authorities would “ load ” retail prices to make undue profits is not convincing. The steady increase in the cost of production is a potent influence for keeping prices down. Nor is there much merit in the contention that country people would be “exploited”. On the whole they seem to have the most to gain from rationalisation. The scheme is sound in principle and could be equitable and efficient in practice.