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Power prices

March 11, 2013

Like most people Adam dislikes the way power prices seem to rise inexorably, this is in spite of a high proportion of our power being hydro.

However, he was somewhat taken aback when he heard this item on Moaning Report today.

The plea by Labour and Green spokespeople for Government to take action to lower prices was ironic to say the least.

Lowering prices by Government fiat would not only be a sign of a dictatorial state but would lead to lower profits by the currently 100% state owned companies, even perhaps causing them to lose money. Yet Labour and the Greens constantly harp on about the fact that these assets should not be partially privatised because they are so profitable. Somewhat of a contradiction!

Furthermore under the Clark/Cullen regime prices were ruthlessly hiked year in and year out to create profits which were then used to provide election bribes amongst other things. At least one report has suggested that Labour extracted some $4 billion more than necessary from power company pricing. So for Labour politicians to campaign for lower prices is hypocritical given their track record.

It is nonsensical as well to demand lower profits when previously the same people have campaigned on retaining the assets so as to enable earnings to be retained.

Adam suggests that a more appropriate approach is to consider why NZ a country blessed with hydro should have to cope with the power pricing it does and regulate if required accordingly.

 

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