Electricity Competition Task Force Welcomed, But Follow-through Needed

The announcement of an Electricity Competition Task Force by the Commerce Commission and the Electricity Authority is welcome news but fixing the market will require more follow-through than the regulators have shown in the past, Octopus Energy Chief Operating Officer Margaret Cooney said today.

“The Task Force’s goal, of enabling new generators and independent retailers to enter and better compete in the market, is absolutely crucial to ensuring security of supply, sustainable and competitive pricing, and more innovation to aid the electrification of New Zealand,” Margaret Cooney said.

“Barriers to competition in the market have been consistently identified in official reports over the past 15 years, but a lack of action has led to the current situation of constrained supply where we are overly vulnerable to dry winters or fuel shocks, and where the market lacks the innovative tools to manage demand.”

“The gentailers reported profits of over $1 billion in the last year, even before the current crisis which has seen super-profits of $70-90 million per week since July while regional businesses shut their doors. This shows that more genuine generation and retail competition is urgently needed to keep prices down and keep businesses open.”

“This Task Force is looking at all the right questions, but what we really need is prompt action.”

It was also very encouraging that the Task Force was looking at how end-users can be empowered to manage their demand, Margaret Cooney said.

“Octopus has consistently advocated for the adoption of mechanisms the UK has adopted, where households who choose to reduce their consumption during periods of limited supply can be paid for taking demand out of the system, just as generators would be paid for adding supply, since the effect is the same.”

© Scoop Media