Lines charges rise ECan’s ‘limited ability to combat blooms’
Alpine Energy’s line charges are on the way up but whether consumers face higher electricity bills will depend on whether power companies decide to pass the increase on.
The South Canterbury lines company has just announced an average increase of $0.41 per day for the residential delivery charge and $1.58 per day for businesses.
If the cost is passed on to the consumer, power bills would increase an average of $12.47 a month.
The impact on individual customers will vary depending on factors such as annual consumption and in what way the retailer passes on the network price changes to its customers. Typically, lines charges make up 30 per cent of a person’s power bill.
However, power companies could decide to absorb the cost and already Genesis Energy has already confirmed to Stuff there would be no changes to South Canterbury users’ power bills as a result of the increases.
Meridian, however, said they do pass increases on. Contact Energy and Trustpower have not yet responded to enquiries.
Alpine Energy chief executive Andrew Tombs said the decision to increase delivery charges had not been made lightly.
‘‘2019 is the last year of our catch up,’’ Tombs said in reference to a decision in 2012 when the commission determined that Alpine Energy had set its prices too low to cover costs and had allowed a catch up on lost revenue over the past seven years.
‘‘The increases are in accordance with the Commerce Commission’s price setting that is capped at Consumer Price Index (CPI) plus 11 per cent...
‘‘At the same time, we know that these kinds of increases have an impact on households and businesses, so we balance that against the assurance of a safe, robust and resilient network while distributing funds back to our community shareholders.’’
‘‘The Commerce Commission is currently working on the default price-quality path reset, which will see new regulatory framework from April next year.’’
It follows last year’s average increase by $0.36 per day for residential and $1.19 per day for businesses.
The company’s prices has been regulated by the Commerce Commission since 2010, which in 2012 declared it had set its prices too low to cover costs and allowed the lines company to catch up on lost revenue over the last seven years.
The Commission has an expectation that lines companies will set its charge increases at the rate it recommends. Since 2016, Alpine Energy has spent more than $76 million on assets.
Tombs said that it expected that lines charges will flatten or even decrease from next year.
Earlier this month, Alpine Energy received a formal warning from the Commerce Commission for breaching the System Average Interruption Duration Index (SAIDI) during 2014 and 2016. The Commission also expressed concern about the past under-investment in its infrastructure.
Alpine Energy is owned by Timaru District Holdings Ltd (47.5 per cent), Line Trust South Canterbury (40 per cent), Waimate (7.54 per cent) and Mackenzie (4.96 per cent) district councils.
Late last year, Alpine Energy was at the centre of a controversial proposal by TDHL.
The proposal, to sell down a 47.5 per cent shareholding in the lines company, received more than 500 public submissions – most opposed the sale.
In December, Timaru councillors voted unanimously against the proposal. There is ‘‘limited ability’’ to control a toxic outbreak at Geraldine’s Waihi River, Environment Canterbury says.
Instead, the authority can make people aware of the potentially toxic cyanobacteria algae in the river and how they can avoid exposing themselves and their pets to the potentially toxic algae, ECan principal scientist Shirley Hayward said.
She made the statement on Monday following the identification of moderate cover of the potentially toxic algae in the river on Friday – the fourth summer in a row the river has had the warning.
Algal bloom health warnings are also still in place for the Waihao River in South Canterbury.
"We have limited ability to combat the occurrence of river cyanobacterial blooms, our focus is on making sure that river users are aware of the risks,’’ Hayward said.
The algae water was identified in the Waihi River at Wilsons Rd on Friday, February 22, it was confirmed.
Monitoring of the site began in the summer of 2013/14, Hayward said.
‘‘We also inspected sites on the Waihi River at the gorge campsite and at Winchester.
‘‘There were only minor amounts of the potentially toxic algae at these sites,’’ Hayward said. The sites would continue to be monitored weekly, she said.
Warning signs were erected by the Timaru District Council on Friday at the Wilson St footbridge, Hayward said.
"Cyanobacterial algal growths are a natural part of our river systems.
‘‘Many species are harmless, but a few like phormidium can produce harmful toxins.
‘‘These algae grow in response to nutrients, sunlight, warm temperatures and stable flows,’’ Hayward said.
‘‘While research is continuing on what causes cyanobacterial blooms, that is excessive amounts, we currently know that periods of warm temperatures and stable flows are key risk factors in the likelihood of a river cyanobacterial bloom.’’
There are limited options available to control the growth of cyanobacteria in rivers, she said.
‘‘It is really important that river users know what it looks like and how to avoid exposing themselves and their pets to the potentially toxic algae.’’
Canterbury medical officer of health Dr Cheryl Brunton said there were other access points along the Waihi River that may have cyanobacteria present and people were advised to check for the presence of cyanobacteria and avoid contact.
The Waihao River near Waimate has a health warning.