Power cost to rise 5 p.c.

Press, 18 February 1986, Page 1

Power cost to rise 5 p.c.

Christchurch electricity consumers will pay 5 per cent more for power this winter.

The increase is 2 per cent less than the 7 per cent approved by the council’s airport and electricity committee earlier this month and 1 per cent more than the increase Labour councillors fought for last evening. The supply charge will stay at $3 a month.

Cr Morgan Fahey, chairman of the council’s electricity committee, brought the new figure to last evening’s council meeting, where his fellow Citizens councillors voted it in by 10 votes to nine Labour votes.

The saving on the 7 per cent increase comes from a reduction in the much criticised transfers of M.E.D. funds and the abandoning of $1 million of capital expenditure for a new ripple control system this year., Transfers will now total $3 million rather than the $3.7M proposed. Labour councillors tried to further reduce the transfer figure to $2.5M. Cr Rex Lester called for the council to reduce the transfer of M.E.D. funds. He also called for a reduction in capital expenditure of another $350,000 above the sum alloted for the ripple control system. These changes would bring the increase to 4 per cent, an acceptable figure on par with the

bulk tariff increase. Cr Fahey said he had reduced expenditure as far as possible. He did not know at this month’s electricity meeting that technical difficulties made the introduction of the new ripple-control system unlikely this year. Problems with correction capacitors at the Islington sub-station and a 10-month delay for injection equipment meant funds for this equipment in the 1986-87 year were not necessary. To accusations of “elec-tion-year twitch” because of the substitute recommendations to those passed by his committee, Cr Fahey replied that he had compromised. “I have done my best — we have done our best — to bring the increase down and at the same time do something about the transfers,” he said. Cr Fahey said he had

long opposed the transfer of funds, well before the Minister of Energy, Mr Tizard, had publicly criticised the City Council for making transfers.

Labour councillors had never before opposed transfers, he said. Cr Lester said that he and fellow Labdur councillors had tried at the committee stage to have the capital works reduced, and transfers also, to keep the tariff increase within an acceptable level. They had been beaten at every turn by Citizens’ domination, he said. He said he believed the capital works budget could be further trimmed by $350,000. He could not see the need for computerising accounts when electricity supply was In the throes of reform or for the full amount being allowed for M.E.D. extension which he did not

believe would be finished this year. The Mayor of Christchurch, Sir Hamish Hay, said he hoped Cr Lester realised that reducing the increase from 5 per cent to 4 per cent by restricting transfers would mean Christchurch ratepayers would face an extra 4 per cent increase in rates.

“Ah, but they would have cheaper power,” retorted Cr Geoff Stone. Cr Fahey said the average domestic consumer used 1500 units in two months. On a 5 per cent increase in energy and demand charges, that meant another 43c a week. The proposed cost of power per domestic unit used is 4.854 c. The supply charge would not be increased, in spite of a 16 per cent increase in the costs of actually getting power to people, Cr Fahey said. He stood by the 7.9 per cent increase cost figure to the M.E.D. of supplying power. That was estimated on a 2 per cent increase in the amount of power used during last year’s mild winter.

“We must budget for a harsher winter,” Cr Fahey said.

Cr Matthew Glubb accused Labour councillors of doing irreparable harm to the M.E.D. if they voted for Cr Lester’s proposals.

Already the appropriation account was being run down to the minimum,'* he said. Further

restriction on transfers would do significant damage. The Dunedin City Council had passed a 9 per cent increase in its power charges, Cr Glubb said. And Ashburton 8.9 per cent, Otago Central Power Board 10 per cent, and the Waitaki Board 10 per cent, said Sir Hamish. “We were not out of the way at 7 per cent, but five seems to be very reasonable.” Cr Fahey reiterated there was no way that the tariff increase could be held to just the 4 per cent rise in the bulk tariff. He said he had discussed the tariffs with the Canterbury Manufacturers’ Association, but those, discussions about power prices for industry and the effect on industry shifting north where natural gas was cheaper had not influenced his decision to bring forward new recommendations. The 5 per cent increase in energy and demand charges (except the day rate unit) was approved by the council, voting on party lines. The M.E.D. annual plan and budget will now be referred to the budget sub-committee. The tariffs will take effect from jipril