Power prices may fall

Press, 26 April 1989, Page 9

Power prices may fall

PA Wellington Adjustments to power prices over the next decade may lead to cheaper power for South Island domestic consumers, the Ministry of Energy said yesterday. Smaller industrial consumers may also benefit, according to a report prepared by the Ministry in conjunction with accountants. The report said people living close to main sources of supply or in regions of high load, may also be advantaged. But rural consumers and domestic consumers

“in general” could be faced with higher prices, it said. It concluded that over the next 10 years there would be adjustments in electricity prices “to bring them better into line with the costs of supply.” The report was commissioned by the Ministry to comment on recent trends in electricity prices and likely future price movements. It suggests that over all there should not be a big movement. However, there may be rebalancing of prices with advantages to some groups of con-

sumers and disadvantages to others.. Present legislation requires the same tariffs for rural and urban consumers, although rural consumers are more costly to supply. “Whether or how prices will increase for these groups will depend on the outcome of the Government’s restructuring of the electricity industry and the detailed legislative changes.” The report recommends monitoring of prices and other information after restructuring.