Demand for power profit ‘unreasonable’

Press, 27 July 1989, Page 3

Demand for power profit ‘unreasonable’

By

TOM METCALFE

A Government directive to Electricorp to return 11.5 per cent on equity this financial year has been attacked by the Canterbury United Council as against the national interest.

The United Council will write to the shareholding Ministers of Electricorp to express its “strong disapproval” of the demand, which a staff report said was "unreasonable and unjustified” at a.time of "gross excess generating capacity.” It would limited Electricorp’s ability to introduce fair electricity prices for consumers, the report said. In its last financial year, which ended on March 31 this year, Electricorp made a return on equity of 11 per cent. The directive to boost the return to 11.5 per cent was “in conflict with national interest considerations,” the report said. The Government-imposed rate of return and valuation for Electricorp assets had meant the adoption of an electricity pricing policy that was against the interests of the whole country. The latest demand would mean more “spilling” and further under-

utilisation of surplus generating capacity. Summit Road proposals Christchurch City is concerned that a revision of the law governing the protection of the Summit Road might be ill-timed. In its submission to the United Council on the draft Summit Road Protection Bill, the City Council said that now was not an appropriate time to seek changes because of the Government’s reviews of local government and resource management. “Future changes (in local government and resource management laws) may well affect how the protection of the Summit Road is best dealt with in the future,” the submission said. Christchurch City was the only council within the area protected by the Summit Road Protection Act, 1963, to oppose the draft bill.

United Council staff said it was desirable to proceed with the bill to coincide with the review of local government and resource management. Decisions on each could be made together, they said. The United Council will consult local members of Parliament about the timing of the bill. Staff appointed Three senior staff positions in the Canterbury Regional Council have been filled. Mr Max Barber, the regional planning manager for the United Council, will be the planning and resources manager for the new regional council. The United Council’s transportation planning manager, Mr Brian Hasell, wiU be the regional council’s transport '.anager.

The L >d Council’s secretary, Mr Peter ry, will be the regional council’s corporate services manager.