Power rise possibly 17 p.c.

Press, 12 September 1980, Page 4

Power rise possibly 17 p.c.

The electricity price rise being considered by the Government might be nearer 17.9 per cent than 8. per cent, the Under-Secretary for Energy (Mr Brill) has said in Christchurch. Mr Brill was answering a question by the Mayor of Christchurch (Mr Hamish Hay) at the South Island Local Bodies’ conference, about reports of a possible electricity price increase being announced at the Electrical Supply Authorities’ conference in two weeks. No decision had been made by the Government oh an increase for the price of bulk power, but any increase would probably be nearer rate of inflation, Mr Brill said. No increases would be made in the “real” price of electricity, although annual adjustments would probably be made to take account of changing money values, he said.

These adjustments were

necessary to retain a realistic electricity price. It was not possible to freeze the price of electricity as this would necessitate a big catch-up, as in April, 1979. Mr Brill told the conference that he found it difficult to accept that electricity Costs were causing genuine hardship to more than a small group of lowincome people. Defending the Government’s rejection of an appeal for a general 25 per cent concession , on tariffs for South Island electricity consumers, he said that power bills took a smaller percentage of take-home pay than they did in the 1950 s and 19605, although householders used 25 per cent (more power than they did 20 years ago. In relation to old age pensions, electricity prices were lower than “normal” as superannuation had been substantially increased and was tied to wages.

Mr Brill dismissed the argument that South Islanders should receive a concession because they were obliged to use more electricity than their northern counterparts. This was true of many parts of the South Island,, but applied only to heating, which accounted for 10 to 15 per cent of the average power bill for an all-electric house. Mr Brill noted that parts of the South Island had a higher mean temperature than parts of the North Island: Christchurch was warmer than such places as Tr.umarunui or Taihape. "Some supply authorities service both warm and cold areas, but none of them (including South Island authorit es) have ever taken the lead in supplying a differential tariff based on mean temperatures,” Mr Brill said. There was no evidence that the small additional power cost of living in a South Island city was any

deterrent to regional development programmes or to people’s desire to live in these cities. If hardsnip did occur, Mi Brill said, assistance should be made available through the Social Welfare vote.. rather than as an across-the-board grant. Although North Islanders had a choice of fuels, 89 pei cent of households were not reticulated to natural gas. Electricity was a South Island resource, but the South Island had been served we*l by the “one country-one price” principle. Mr Brill said he could not endorse divisive policies which separated New Zealand into two parts. The Government was completely confident that concentrating metal smelting industries in the South Island was the only course of action available to ensure economic growth in the next 20 years.