Planning 50 years ahead

South Canterbury’s energy company is considering 50-year plans after being told to think further ahead, despite flickers of doubt from a national industry association.

Alpine Energy was used as a case study for a wider report on the industry, along with Unison Networks Ltd and Waipa Networks Ltd.

The Auditor-General’s office, which prepared the report, expressed surprise none of the three companies had replacement forecasts for their assets which extended beyond 10 years.

Companies should be thinking at least 50 years in advance, as estimates should extend to the end of the projected lives of assets, the report said.

Alpine Energy chief executive Andrew Tombs said 50-year plans were ‘‘a good idea’’, and the bulk of Alpine’s assets lasted well beyond 10 years.

‘‘We are considering it because we believe it has merit,’’ he said.

‘‘It will certainly be challenging to [forecast to] any specific level of certainty, but the value in forecasting this far ahead is it will provide a snapshot of future spend profiles based on history and age profile of the assets.’’

Electricity Network Association chief executive Graeme Peters said the typical 10-year plan already used by electricity companies was ‘‘medium-term’’ and required a lot of detail.

It was possible to plan further in advance, and some companies did, but he questioned the value of plans prepared 50, or even 30, years in advance.

‘‘It’s actually very possible they will turn out to be inaccurate.’’

The report comes after a snapshot of the company from the Commerce Commission gave Alpine Energy a ‘‘red’’ rating for the state of some of the assets in its net- work, such as distribution lines and switchgear.

The rating indicated they were a potential risk, but Tombs said at the time outmoded methods of reporting contributed to the result.

The Auditor-General’s report said all of the companies used as case studies had to increase their understanding of the condition of their main distribution assets.

Better information disclosure was a challenge for the entire industry, Tombs said.

‘‘There’s always improve.’’

Alpine Energy provides power across South Canterbury from the Rangitata River to the Waitaki River, and 47 per cent of the company is owned by council entity Timaru District Holdings.

For the last two years Alpine Energy had been working on getting a better data system in place, and the report said ‘‘a new enterprise-wide asset and financial management system’’ would help the company meet its needs.

When it came to looking after risk management, the South Canterbury company had improved in the last two years, the report said.

‘‘In 2015, Alpine approved an updated risk management policy, which focuses on health and safety, network risk matrix, and corporate risks,’’ the report said.

The report, presented to the House of Representatives on Tuesday, also noted Alpine was actively planning improvements, such as charging stations for electric vehicles.

Tombs said the company had put in two charging stations in Timaru and Waimate, and was intending to put in another four - in Geraldine, Tekapo, Twizel and Fairlie.

The three companies had all estimated their future demand, but the depth and sophistication of assumptions and analysis varied between them.

Unison carried out the most extensive analysis. room to