speech notes from the Alliance Party

Electricity Bill third reading speech
Kevin Campbell, 31 July 2001

Electricity is a key strategic asset of this country. Every day New Zealanders rely on electricity at home and at work. Everyone, from the cradle into retirement is reliant upon electricity in New Zealand.

This is why the National government and Max Bradford's forced privatisation of the electricity industry was bound to fail. An open market does not have to guarantee supply, yet this is an essential element of the electricity sector, which National didn't understand. It is their free for all privatisation which has made this Electricity Bill essential.

The previous government's attempts to band aid the problem with some lightweight regulations weren't effective enough either. Power crises kept happening. Not only was there the major crisis of Mercury Energy in Auckland, but small towns around the country soon discovered that they didn't have the essential back up they needed to bring the power back on after it was cut as it was by extreme weather conditions in Central Otago.

We can't run a country without a reliable power supply. We can't rely on hope to make sure electricity companies like On-Energy don't fall over. In an open market, companies fail. We are lucky that there is another company able to pick up the pieces this time. But that's not enough of a guarantee for parents looking after new-borns, kids coming home from school to a cold house, students trying to cook up a meal, nor is it enough for the many hundreds of businesses around the country which provide jobs and economic stability to this country.

Reliability of supply is a key plank of the Alliance's energy policy. And we support this bill's moves in that direction. This bill aims to encourage the industry to develop its own solutions to ensure that electricity is delivered in an efficient, fair, reliable, and environmentally sustainable manner to all consumers. This is a significant improvement of the unrestrained free market of National and ACT.

The bill also provides the Government with regulation-making powers to be exercised if the industry fails to deliver those solutions. The Alliance will be encouraging all moves to ensure that the necessary regulations are developed.

An essential element of being able to ensure that electricity is delivered in an efficient, fair, reliable, and environmentally sustainable manner to all consumers, is the ability to establish the Electricity Governance Board if industry fails to deliver industry rules that meet the Government's expectations. In the meantime, the Commerce Commission will have the power to impose price control over line companies, including Transpower. The Commerce Commission will also administer information disclosure and carry out valuations of fixed assets.

The principal objective of the Electricity Governance Board is to ensure that electricity is generated, conveyed, and supplied to all classes of consumers in an efficient, fair, reliable, and environmentally sustainable manner. The Board would make recommendations on rules and regulations that further this objective.

Originally the bill was going to enable regulations to be made to establish an Electricity Ombudsman. This move reflected the concerns, particularly of electricity consumers, that there needed to be a person who could provide unbiased consideration of complaints.

As the industry is no longer a government industry, the term Ombudsman was deemed inappropriate. The committee acknowledged the concerns of the Chief Ombudsman about the proliferation of private sector Ombudsmen, while the role of Ombudsmen normally is to investigate complaints about government departments.

The Alliance believes it is vital to provide an avenue for fair judgement of complaints about electricity issues. Electricity is an essential resource in today's world. The current crisis which has people worried they won't be able to afford to put the heaters on in mid-winter, and which has businesses concerned they may face huge increases that may damage the viability of their business, demonstrates how serious provision of electricity is and thus why an unbiased Complaints Commissioner may prove to be essential.

The Commissioner should also be able to make recommendations to government on any issues that need to be addressed in regulations or legislation.

The bill allows for an Electricity Complaints Commissioner to be established as part of a complaints resolution system, under the electricity governance regulations and I would urge that this option be progressed. The objectives of the complaints resolution system are to promote best industry practise, enhance access to redress for complaints, establish a complaints resolution system for any person, including consumers, about electricity distributors and electricity retailers, to be administered independently.

The complaints resolution system would contain a code of practise setting minimum standards of conduct, contain benchmarks, procedures for complaints within companies and the ability for complaints to be referred to the Electricity Governance Board or other agencies, including an Electricity Complaints Commissioner.

In conclusion - this bill finally recognises the importance of government taking responsibility to oversee and where necessary, regulate essential industry and strategic assets. While the Alliance would in some areas support further regulation and government involvement, we support this bill as it is a step in the right direction.

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