Electricorp denies split

Press, 11 September 1989, Page 8

Electricorp denies split

By DAVE WILSON The Electricity Corporation has denied a Wellington report suggesting that the corporation’s generating assets will be aplit into separate North Island and South Island companies. An assurance that this would not happen was given last evening by the corporation’s chief executive, Dr Roderick Deane. A task force had reported to the Government on restructuring proposals for the Electricity Corporation, and the Minister of Energy, Mr Butcher, will announce the Government’s decisions at the Electrical Supply Authorities conference in Christchurch tomorrow. Dr Deane said a strict embargo on which recommendations would be implemented was being maintained. But a Wellington news report on Saturday, saying the corporation would be split into

North and South Island companies, deserved rebuttal. “We are stating this to allay concern among our staff and also to reassure the financial institutions that lehd us money.” Dr Deane said splitting the corporation had not been recommended by the task force, saying the break-up of a highly integrated system could increase costs more than it could create any compensatory benefits. A north-south split would result in a grossly unbalanced system and would mean both higher costs and higher prices to the consumer. However, Mr Butcher is expected to announce that the national transmission grid, operated by the Electricorp subsidiary, Transpower, will be separated with ownership vested in a "club.” This group would be a mixture of electricity generators and distributors.