Electricity changes ‘regional tax by stealth’

Proposed changes to New Zealand’s electricity pricing structure have been described as a ‘‘regional tax by stealth’’ by submitters.

Submissions have now closed on the plan, which would result in price rises for Northland and Auckland consumers in particular.

The Electricity Authority said it was a fairer way to pay for the national electricity grid but meant some regions would pay more for the benefit of better infrastructure.

The overall impact on residential prices would be an increase of 0.5 per cent, or $11 per household per year.

The biggest increases would be worn by those in Auckland, Northland, Ashburton and the West Coast.

One of the biggest beneficiaries of the overhaul would be Rio Tinto’s Tiwai Point aluminum smelter in Southland, with annual charges projected to drop by $21 million.

The Employers and Manufacturers Association was among those submitting on the changes.

‘‘This is a tax by stealth on our members, and for some of them it will severely impact their business,’’ Kim Campbell, its chief executive, said.

‘‘There are perverse outcomes where changes to electricity pricing will take more out of areas such as Northland than the Government provides to the region in economic development initiatives.’’

The proposal seemed to be more about subsidising the smelter, than sound policy, he said.

Entrust, formerly the Auckland Energy Consumer Trust, said interest in this issue had been strong, given consumers were rarely interested in regulatory consultation.