Quick Dips

Power to the People?

The recent announcement that ECNZ is to be split into two competing enterprises has provoked mixed reactions.

According to the Institution of Professional Engineers, the public is being misled over power prices.

"Currently, the low bulk charges are achieved based on average costs across all ECNZ generation stations. This provides cheap power prices, by world standards, which are a reflection of the actual low generation costs from many existing stations," says spokesman Ken Cory-Wright.

New power stations are bound to produce electricity more costly than the current average, he says, so in order to attract new investors into the power market and provide competition, prices will have to rise.

Cory-Wright also says that with the recent splitting of ECNZ, the government has abdicated its responsibility to ensure that there are no power cuts arising from future demand exceeding supply. He suggests that in a market with multiple suppliers, when brown-outs or black-outs occur, each competitor will blame the others.

"The only good thing is that with higher power prices, users will find that investment in saving energy provides a better return," says Gerry Pallo of the Energy Management Association. "Despite the amount of time spent on the decision, and the reports written, it appears the decision makers have not understood the fundamentals of electricity supply in New Zealand."

The chief executive of the Maruia Society, on the other hand, has reacted very enthusiastically to the move, and feels that the government should have gone further and split off the Huntly power station as a separate company.

"This is the essential first step to a solar-powered twenty-first century," says Guy Salmon. "It opens the way to a revolution in electricity supply, similar to the revolution that took place in the computer industry once the dominance of IBM was broken."

Salmon sees the decision as opening the way to generation via solar, wind and biomass generation in the years before Maui gas begins to run out.

"If we stay with a state monopoly we are just going to get more huge fossil fuel stations."