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Comment Transmission Pricing Methodology Decision Molly Melhuish 11 June 2020

Opinion – Molly Melhuish

The new Transmission Pricing Methodology will make your power bill depend on where you live, not whether you can reduce your demand so as to reduce your power bill while reducing the systems carbon emissions. The electricity industry considers …

The new Transmission Pricing Methodology will make your power bill depend on where you live, not whether you can reduce your demand so as to reduce your power bill while reducing the system’s carbon emissions.

The electricity industry considers it inefficient for consumers to invest in energy efficiency or solar energy. The new pricing will drive local lines companies to increase fixed daily charges while reducing per-unit charges. That means your investments to save electricity will save you less money.

The industry wants to build new wind farms and geothermal stations, and transmission lines to transmit that power all over the country. The new transmission pricing gives them reliable revenues –it’s like a tax you cannot avoid.

Indeed the new pricing system specifically promotes using electricity at peak times. This would increase line losses, and for decades the highest peaks will still be met by gas-fired power stations. So their claim of reducing carbon emissions is simply untrue.

It would be cheaper for householders to invest in retrofits to reduce their electricity demand. And their cost of capital can be less than half the typical corporate cost of capital, which is 7-8%.

But the industry is driven by the corporate goal of growing their assets. Transpower’s vision, “Te Mauri Hiko”, would double New Zealand’s generation capacity, supposedly to become 100% renewable.

This is blatant empire-building funded by an unavoidable electricity tax on residential consumers. Bulk electricity suppliers want pricing that suppresses energy efficiency and local energy supply. These local energy options are cheaper and lower-carbon, and create resilience.

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