Rants, Raves, Reviews

17.36 cents per kWh

By Gary R, in , posted: 26-Jul-2007 09:23

The spot rate for electricity dropped today by 7.5% to $65.63 per MWh. This equates to 6.56 cents per kWh at the wholesale rate. The odd thing with electricity is that the retail pricing only ever increases, it never goes down, unlike petrol which fluctuates based on a number of factors. The only slight reprieve has been the government signaling that the band for cheaper power (based on household consumption) will increase from 8000kWh to 9000kWh per annum but only for the colder regions of our country. This means that if you use less power you will effectively be better off by $20 per year. The irony of increasing this limit is that it will only affect people who don't consume. These people are probably going to work each day and only running heating at night. The people who consume the most power are probably the ones who need the biggest help. Older people, invalids and single parents raising children at home have to have heating and they are probably running the heating for longer periods than those people who go to work.

On Sunday I was having a discussion with my extended family on how much they pay for electricity. My last power bill was $285.00 which is not bad considering my wife is at home raising our son so the heat pumps are on quite often. My in-laws who work Monday to Friday paid $200.00 last month. My brother and sister-in-law paid a whopping $580.00 which was a combination of gas and electricity. Considering that gas is used for heating and hot water they still paid $300 for electricity.

So, from this little group of 3 children, 6 adults and 3 houses we collectively contributed to the SOE gravy train $1080.00 for gas and electricity. Of this gross (and I mean gross) amount $120.00 was GST.

I currently pay 17.36 cents per kWh and the power company still controls my hot water. Based on the current wholesale rate of 6.56 cents the retail margin is a whopping 62%, plus there also the additional 70 cents per-day 'line charge', 'supply charge' or whatever it is for.

Electricity actually has a higher gross profit than that other monopoly the Auckland Airport Company. You have to wonder if 6.56 cents is the wholesale rate what does it actually cost to generate electricity? Does anyone know? There must be a wholesale margin in there somewhere.

Other related posts:
I Thought I would Come Back
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Permalink to 17.36 cents per kWh | Add a comment (3 comments) | Main Index

Comment by Bung, on 26-Jul-2007 10:40

I've just had the Meridian price rise letter, 17.95c incl GST from 1 Sept.
They claim that their average consumer in the Wgtn area pays $175.

In other news large TVs now use more power than a family size fridge.

Comment by sbiddle, on 26-Jul-2007 11:58

Our power bill (2 people) is around $160ish per month. My girlfriend complains about that but with 3 PC's on 24/7 and power for our hot water and cooking and a Plasma that draws a whooping 380W and another 200W or so for the PVR which is normally always running when the TV is on I guess it's not too bad!

Comment by TinyTim, on 26-Jul-2007 15:33

We've averaged $300 per month for the last 2 months. We have a massive electric central heating unit but it's only on for 2-3 hours a day (we don't run it once the kids are in bed). The house isn't as well insulated as it could be - that's a job for this summer.

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