Power Board Attack On Kapuni Gas Policy

Press, Volume CVI, Issue 31365, 10 May 1967, Page 36

Power Board Attack On Kapuni Gas Policy

The Minister of Electricity (Mr Shand) appeared to be doing everything possible to lose the confidence of the consumers and distributors of electricity, said the chairman of the Central Canterbury Electric Power Board (Mr W. A. Newton) in a strongly-worded protest on Government policy for the use of Kapuni natural gas.

At yesterday’s board meeting, Mr Newton said that the Minister had announced that Kapuni gas would be piped to North Island centres. The estimated cost of this was £9m, yet there had never been any mention by the Minister of gas consumers having to pay 50 per cent of the capital costs of distribution, as power consumers were being asked to do.

“ The Power Game’ makes good viewing on television, but when it is applied to our own industry and to our undertaking, it is not nearly so palatable,” said Mr Newton. “Last month, we discussed the imminent increase of approximately 12 j per cent to our consumers to enable the New Zealand Electricity Department to provide additional capital works out of revenue, owing to the nonavailability of loan money. T must ask this question: is this really the reason for the increase, or is it to force the price of electricity up so that the use of gas becomes competitive with the use of electricity and thus make the Government scheme for Kapuni gas sound feasible? “If the second supposition is correct, then we must view with grave suspicion any future statement by the Minister.”

To Mr A. T. Stevenson, who asked if there was an estimate of the life of the Kapuni

gas field, Mr Newton said that one figure was 25 years. Mr Newton said that the Electrical Supply Authorities’ Assodation had asked the Government for an independent survey on Kapuni, but he thought it was correct that the Government had said there was no one in the country who was competent to do it.

Mr Newton repeated that the Government approach to Kapuni seemed solely designed to lose the confidence of electricity users. “Are we aware that the association has not put pressure on the Minister to get him to say where the capital costs of gas distribution are coming from?” asked Mr L. T. Griffith. “In particular, will a countribution come from gas consumers?

“If not, we should ask the association to press the Minister to say how the capital is being obtained. Perhaps some of the cost will come from the extra petrol tax.” Mr Newton, a member of the association’s executive, said the association had no information on the point. “It seems to be part of the Government’s policy to spread the load evenly—big laugh,” said Mr Griffith. The board decided to ask

the association to seek an explanation from the Minister. “The reply probably will be that the charge for gas will include capital charges,” said Mr P. G. Wederell.