Power discounts may lure business

Press, 3 August 1983, Page 9

Power discounts may lure business

Dunedin City councillors are considering a power price discount which would start in October, along with further moves to encourage industrial and commercial development through lower tariffs.

Their concerns, couched in Dunedin City Council finance committee recommendations this week, reflect concerns outlined in Canterbury Manufacturers’ Association submissions to the Christchurch Municipal Electricity Department, which were made public this week.

Manufacturers are seeking a power price structure that would encourage business expansion and job creation.

In Dunedin, the council’s finance committee has approved a 5 per cent discount for all power accounts. That discount, and further moves to study lower

tariffs, have been prompted by continuing high levels of financial surpluses from power generation, and the need to attract industry to Dunedin.

When added to the 25 per cent rebate for South Island industrial power consumers, the discount could mean a price reduction to about the level of Auckland’s industrial price. Along with the discount, the committee recommended the holding of $2.5 million in a separate account in the meantime. Then power prices could be reworked to produce a reduction in all consumer charges, particularly to encourage business development and increased job opportunities. Another $1 million would be used to promote economic development in the Dunedin council’s electricity supply area, which covers

seven other local authorities.

Cr G. W. T. Christie, the council’s finance committee chairman, said the 5 per cent discount would be a “straight-out drop in tariff’ for those consumers who paid their accounts on time, during the 21-day payment period.

That would be different from the Christchurch M.E.D. system, which is a “discount” to the normal power price if bills are paid on time, with a penalty payment after the deadline. Dunedin councillors were told that the 5 per cent discount, which would start in October if the full council agreed, would cost $850,000 this financial year.

Studies would be done to see if the commercial and industrial tariff could be lowered past Auckland’s, which was understood to be the lowest in New Zealand.