Check your swtich board regularly

September 23, 2015

The power went out in our office.

We called an electrician who found this in the switchboard:

switch

The whole board was replaced when we altered two years ago.

The electrician found some of the what-nots (for which there is a technical term which escapes me as I type) needed tightening – some because they can come loose over time, some because they’d never been tightened properly in the first place.

Friends lost power recently and the cause was also found to be due to over-heating in the switch board.

The Fire Service reminds us all to check our smoke alarms when the clocks go forward and back (mutter, mumble, forward this weekend, which is at least three weeks too early). It would pay to check switch boards at the same time.


NZ Power 3x more expensive

September 16, 2014

Labour’s numbers don’t add up for its power policy:

 

Dr Michael Dunn, engaged by the Taxpayers’ Union to provide the figures for the ‘Bribe-O-Meter’ election costing website, is questioning the Labour Party’s costing of it’s flagship “NZ Power” policy.

Dr Dunn says, “Labour’s claim that NZ Power will cost taxpayers’ $90 million per year is optimistic at best. A more realistic figure is $276 million.”

“As the Government continues to own majority stakes in many of New Zealand’s power companies, NZ Power would see the Government forego much of the income tax and after tax dividends it currently receives.”

“When these aspects are factored in, the NZ Power policy would not cost $178 million as Labour is claiming, but instead cost at least $828 million over three years.”

“The foregone revenue to the Crown is, we estimate, $276 million per year. This is significantly more than Labour’s average of $90 million.

“Labour assume that bringing down the cost of power will introduce offsetting economic benefits. But their assumptions are open to debate, and Labour do not appear to consider who benefits, the long term costs, and the cost to the private shareholders of power companies.”

Dr Dunn’s independent figures are reflected in the Taxpayers’ Union Bribe-O-Meter, which tallies this year’s election promises. The Bribe-O-Meter currently stands at $3,500 per household for Labour compared to $760 for National.

Jordan Williams, Executive Director of the Taxpayers’ Union says, “This isn’t some political hack calling into question Labour’s numbers. Dr Dunn led the team at IRD that costed revenue policy for 12 years. He has advised both National and Labour administrations.”

“The Bribe-O-Meter is to give transparency to the cost of politicians’ promises as we head into the general election.” . . .

A power policy costing us three times what Labour reckons on top of five new taxes and compulsory KiwiSaver with higher contributions all add up to a lot more money out of people’s pockets.

 


Lower power price increases

July 17, 2014

Power price rises are one of the sticks with which opposition parties try to beat the government.

It’s an easy hit because all but the self-sufficient use power and the lower people’s budgets are the greater the proportion of them has to be spent on the power bill.

However, the facts don’t support their criticism:

New power price data released today shows the Government’s 2010 electricity reforms are making a real difference for consumers, says Energy and Resources Minister Simon Bridges.

“The sales data released by the Ministry of Business, Innovation and Employment for the year ending March 2014, shows the lowest annual price increase since 2001 at 2.3 per cent,” Mr Bridges says.

“Discounts and other benefits from retailers are becoming the new norm in an increasingly competitive electricity market and the new data captures what consumers have actually paid for their power, rather than the advertised price.”

MBIE has also released the June quarter of the price indicator known as the Quarterly Survey of Domestic Electricity Prices (QSDEP), which captures the latest April price increases.

For the June quarter, there has been an increase of 2.3 per cent.  This was driven by a 6.7 per cent increase in lines charges — the component regulated by the Commerce Commission — as retailers passed on the significant investment costs associated with upgrading local networks.

The energy component — the part subject to competition — decreased by 0.7 per cent.

Mr Bridges says competition is the best way to keep prices down and the latest electricity data shows that the Government’s 2010 reforms have helped bring runaway power price increases under control.

“Since the National-led Government took office in 2008, we have halved the power price increases seen under the previous Labour Government.”

Latest figures released by the Electricity Authority show that consumers can save, on average, $155 per year by switching power retailers.

“I encourage consumers to continue to shop around for the best deal,” Mr Bridges says.

The latest electricity price data can be found here: http://www.med.govt.nz/sectors-industries/energy/energy-modelling/data/prices/electricity-prices

Editor’s notes:

In March 2014, the Minister of Energy and Resources announced changes to improve electricity price monitoring and provide more accurate information about how the market is performing. http://www.beehive.govt.nz/release/changes-improve-electricity-price-monitoring

The previous way electricity prices were monitored wasn’t detailed enough to capture all the discounts and benefits being offered as a result of an increasingly competitive electricity market.

MBIE has worked with electricity retailers to develop the new approach, which reflects what people have actually paid for their electricity, including discounts and benefits.

The new data is based on the actual volume of electricity sold and the total revenue, to give the average price paid per kilowatt hour.  It includes prompt payment, multi-fuel and online discounts, as well as incentive and retention payments, and rates paid by consumers on fixed-term plans.

MBIE and the Electricity Authority will continue to work to improve electricity price data, including access to, and analysis of, more detailed consumption data with a view to making this publicly available in 2015.

 The reforms are working and they are far better than the back-to-the-future power play proposed by Labour and the Green Party.

Our 2010 electricity reforms are making a real difference for consumers. national.org.nz/news/news/media-releases/detail/2014/07/15/new-price-monitoring-shows-competition-strengthening #Working4NZ


LabourGreen power play will cost us all

April 24, 2014

Who are you going to believe – politicians trying to win votes or the director of the Programme on Energy and Sustainable Development and Holbrook working professor of commodity price studies with the department of economics at Stanford University?

Frank Wolak is the latter and he’s not impressed with the LabourGreen power plan:

This desire to “reboot” the electricity supply industry is understandable, but it is almost certainly not the best course of action. As a participant in many electricity industry restructuring processes around the world, one important lesson that I have learned is that all reforms start with significant unintended defects that can only be eliminated through a rigorous ongoing analysis of market outcomes and targeted regulatory reforms.

Many features of the current industry structure are consistent with international best-practice and a number of positive changes have been implemented since I completed my report for the Commerce Commission in 2009.

Continuing these efforts to identify and fix flaws in the existing market is likely to provide greater long-term benefits than undertaking a major restructuring of the industry. . .

He thinks major change is needed, but not the LabourGreen one.

His suggestion is to establish a regulator for the industry with a statutory mandate to protect electricity consumers from economic harm.

There are a number of legal rights that a regulator must have.

First, the regulator must have the ability to request any information from market participants necessary to carry out its statutory mandate, receive this information in a timely manner, and have the authority to impose financial penalties on market participants that fail to provide the requested information in a timely manner.

The regulator should also be allowed to require that all of the firms that it regulates prepare balance sheets and income statements using a standardised accounting system designed by the regulator. These accounting systems will allow the regulator to carry out the very important task of setting prices for monopoly services such as transmission access and distribution network access.

The regulator should be required to set prospectively the price of these monopoly services to allow the firm the opportunity to recover the prudently incurred cost of providing these services.

This does not mean that the firm is guaranteed full cost recovery regardless of how it incurs these costs. Because its price is prospectively set by the regulator, the firm’s revenues are independent of any actions it takes, so it has the opportunity to recover these costs if it incurs them in a manner consistent with what the regulator deemed to be reasonable when the price was set.

The final right of the regulator is to set the market rules governing the operation of the wholesale and retail markets.

Rather than allowing market participants to determine the terms and conditions governing participation in these markets, the regulator must set these market rules to protect the electricity consumers from economic harm. Market participants and other interested parties can provide input to this process, but ultimately the regulator must set these market rules because of the enormous impact they have on wholesale and retail electricity prices paid by consumers.

An essential feature of this redesigned regulatory process is an ongoing market monitoring process where the regulator uses data compiled from market participants and data submitted to and produced by the market operator to undertake market performance analyses. Although this market monitoring process is extremely data and human resource intensive, it is necessary for the regulator to anticipate significant market performance problems and take action to ensure a small problem does not become a large problem that harms consumers.

Another role of the regulator is to provide transparent information to customers on the components of retail electricity prices. . .

This is very different from the LabourGreen plan which Wolak described as:

“a sham that might make me feel a bit better”, but was the wrong weapon to attack “runaway” retail electricity tariffs, which he says are the real problem in current market arrangements. . .

Wolak says the NZ Power policy, which would unpick a 25-year-old experiment in electricity market design in favour of a centrally planned model, “may not even solve the problem, which is runaway retail prices.” . . .

“It may look good, but it’s got lots of challenges,” said Wolak of the Labour-Greens policy. “You’re throwing the entire baby out just to get rid of the bathwater and you’re going to start over, as if you have all these problems.

“My argument is that some of the changes since 2009 are pushing in the right direction,” said Wolak, whose 2009 report for the commission found evidence of electricity generators wielding market power at different times, to maximise the value of their generation efforts.

From that, officials calculated $4.3 billion of “excess charges”, which then Energy Minister Gerry Brownlee acted on by shaking up the national retail market, which is now more competitive, with high levels of customer churn. . .

However, Wolak believes moving to a cost-based, single buyer model could be a disaster.

“If what they are going to try and do is say ‘we are recovering costs and allowing you a fair return’, then oh my god, it’s just a can of worms that you wouldn’t believe that’s going to get opened,” Wolak said of Labour’s plan to calculate rates at every power station in the country on a cost-plus return basis.

“They are going about it in a kind of bass-ackwards (sic) way and saying ‘we’re going to say what each guy’s price can be in terms of generators selling’. That’s just a nightmare.”

“What’s simplest is to say we’re going to make this thing as competitive as possible.” . . .

The Labour-Greens' 1970s power policy won’t reduce your power bill, but it could cost millions to taxpayers.</p> <p>www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11241830


Powerless

June 25, 2009

A note in the mail box a couple of days ago informed us the power would be off from 10 until 12.30 today while trees near power lines were trimmed.

Thanks to the warning I was prepared – kettle in the office boiled so the staff could have morning tea, computers unplugged and a list of things to do in town.

But when I got back at 12.45 we were still powerless.

They usually over-estimate the time needed but this morning’s job took longer than expected. An extra half hour without power ought to be neither here nor there and it wasn’t a catastrophe but any time without power is inconvenient.

No power means no phone and no computers. It also means no microwave and a couple of men had brought pies for their lunches.

Still it’s back on again and all’s well – except for the seven electronic clocks on radios, oven, mocrowave, DVD . . . . which will have to be reset.


It’s not their money

February 12, 2009

 Does Meridian Energy realise what it’s saying?

Increasing power prices now would shield customers from large increases if and when planned schemes came about: “Small increases provide a smoother path for consumers.”

 Is it the job of a power company to “provide a smoother path for consumers”?  That sounds like they think  they’re better able to manage our money than we are.

My concern is increased because of the proviso “if and when planned schemes come about”

What happens if planned schemes don’t come about, will we get our money back, with interest?

And how much more power generation do we need? The reduction in production at the Tiwai aluminium smelter means there is considerably less demand for power than there has been for some time.

The Remuneration Authority has a similar line  with regard to local body pay rates:

Authority chairman Richard Oughton, in the circular, said some local bodies were considering not increasing pay.

He said the increase from July 1 was conservative, somewhat less than it should be based on market conditions.

“A zero increase could create a situation where a larger, and perhaps less publicly acceptable, adjustment may be needed from July 1, 2010.

Further postponing an adjustment at that time would only serve to exacerbate the problem,” he said.

 He too is saying that a lower increase now will mean a bigger increase later.

I think ratepayers would prefer to keep a little more of their own money now and worry about how acceptable future pay increases are when the time comes. 

The government is sending very strong messages about the need for restraint so it’s possible that the pubic and private sector salaries on which councillors’ remuneration is based may show little or no increase in the short to medium term.

That would mean the big increase that Oughton is concerned about may not eventuate anyway.

If it does, at least we’ll have had a wee bit more of our own money under our own control in the meantime.


Blackout blues

February 3, 2009

There’s no convenient time for a power cut and it’s small consolation for the individuals and businesses inconvenienced by the loss of supply  in Auckland today that it happened while it was still light.

The power went off in Northern Queensland  from Ayr to Cooktown just after we arrived in Townsville 12 days ago. It was early evening which wouldn’t be quite so bad here as it was there where the sun goes down about 7pm.

I had to drive to a hen party and had a local navigating who helped me at intersections. My brother got safely to the stag party by luck alone because he drove through the city oblivious to the fact that the traffic lights were out.

No-one will be impressed by the explanation for today’s power cut – one transformer down for routine maintenance and a problem with a second which put two much pressure on the third.

But that’s probably not as bad as the cause of the problem in Queensland – bird droppings  from nesting eagles.


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