S.I. differential left alone

Press, 29 January 1988, Page 4

S.I. differential left alone

The South Island’s 22 per cent bulk electricity price differential emerged unscathed from the price increases announced yesterday. Electricorp said the differential would continue, although the previous bulk supply tariff to retailers would effectively end. A list of prices for the complex menu of charging options showed a fixed supply charge common to both islands. But all other charges or options reflected the differential. This price list, based on the 6.7 per cent average increase recommended by Electricorp, will next week be amended in the wake of the Government’s insistence on a 7.5 per

cent rise. But the corporation’s marketing manager, Mr Drew Stein, said the differential would be more or less evident depending on the retailers’ choice of option, and its commercial performance. . If retailers in either island took the first or “six-part pricing option” and had the same loading factor, there would be a 22 per cent difference in price. But use of the “risk share pricing option” meant that the difference in prices could be higher, or lower, than 22 per cent. The corporation said yesterday that it believed the six-part option would ultimately be phased out,

as more of its customers opted for the “risk share option.” The general manager of the Christchurch Municipal Electricity Board, Mr Hallett Mace, said last evening he was unable to comment on the effect the wholesale electricity price increase would have on retail prices until after the board’s next meeting. The board would meet on February 15 to discuss its annual budget, and Mr Mace said that retail power prices would probably be considered then. “It is good news for the South Island that the 22 per cent differential is to be retained,” he said. “It would have been very sad if we had lost it.”