Wellington Electricity Lines

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#996768 28-Feb-2014 23:33

dwl:
Aredwood:
Geektastic: Whilst we are on the subject...

WTF is the levy we pay to the Electricity Authority actually doing for us as consumers?

They run the "whats my number" website and advertising.

In otherwords you have to pay more on your powerbill, just so they can tell you to try and save by switching companies.

I assume it is this amount: Electricity Authority Levy of 0.146 cents per kWh. At 8000 kWhr/yr that's $13.40 inc GST no prompt payment discount. While I'd rather not pay it, at 0.5% of my bill it isn't the main concern.

But what IS it?!

if 2 million bill payers all cough up $13 a year thats a fair sum for a couple of infantile websites that don't really help.

dwl

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#996826 1-Mar-2014 08:23

In today's DomPost big ad on WEC charges and details on WE website which has confused me more. They say "The lines charges are a component of the total electricity account you receive from your electricity retailer. Wellington Electricity's lines charges represent around 34% of the overall bill.".

However, the PDF here has rates which seem to need multiple components to make up the bill with an example of "Single meter without control (standard user), fixed charge" going up from $0.15 per day to to $0.90 per day. I assume you then have to add a low voltage or transformer connection.

Could anyone please clarify how these charges might get up to 34% of the overall bill? This isn't making sense.

dwl

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#997763 2-Mar-2014 20:22

It's gone a bit quiet here - maybe others have better things to do with their time or have just given up as too confusing ....

The table for residential contains a daily rate and usage based charge. Using one example (are these two lines applicable for an anytime user?):

If I understand it correctly, the reduction in $/kWhr rate mostly offsets the huge increase in daily rates but still leaves a significant rise for the WE component. There will be differences between users depending on their plan. WE are saying "The impact of the price increase on the average customer bill is around 4%" but as their portion of the total bill is around 35% then their increase is about 3 * 4% (based on their table).

The increases seem well above the CPI but I haven't checked back over the years the per annum changes so perhaps it is some catch up. Any other thoughts out there?

Dratsab

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#997773 2-Mar-2014 20:58

I suspect a lot of people have had a lot of other things on their plate over the weekend rather than anything else.

Most of this seems to be puffery around total numbers. The primary focus should be on the daily fixed line charge which, to the end consumer, will go up by over 80%.

The secondary focus should be why are ALL electricity companies suddenly going to be able to discount their rates by a couple of cents/kWh? And why did they all suddenly come to the decision to do this? Collusion and price fixing immediately spring to mind. I also wonder how long it'll be before we see the kWh rate creep back up again so the electricity rates "reflect the true cost of generation".

mckenndk

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#997799 2-Mar-2014 21:27

Hmm be interesting to see what the monthly Lines Company bill in Ohakune will be this year.

Previous three years has gone up from $92 to $96, it gets re-assessed every year over a month in the winter as per your usage and they charge you the same fee every month for a year and the power bill is separate.

I can see another hike on the way.

JamesL

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#998301 3-Mar-2014 17:50

Increased prices and a power cut to most of jville/broadmeadows http://www.stuff.co.nz/dominion-post/news/9782496/Power-cuts-train-delays-amid-thunder

Sigh.

Called up powershop and they said ETA ~7:30 pm

mattwnz

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#998310 3-Mar-2014 18:03

Dratsab: I suspect a lot of people have had a lot of other things on their plate over the weekend rather than anything else.

Most of this seems to be puffery around total numbers. The primary focus should be on the daily fixed line charge which, to the end consumer, will go up by over 80%.

The secondary focus should be why are ALL electricity companies suddenly going to be able to discount their rates by a couple of cents/kWh? And why did they all suddenly come to the decision to do this? Collusion and price fixing immediately spring to mind. I also wonder how long it'll be before we see the kWh rate creep back up again so the electricity rates "reflect the true cost of generation".

They will argue it is competition. eg if one comapny lowers their price, then people will switch to that lower priced provider, unless the others match. But it sounds like a method to soften the price rise with the big lines price rise. It is certainly very interesting that many retailers seem to have lowered their per kWh rate price to effectively soften the price rise caused by the lines company. I imagine if they didn't do that, then there would be heaps of compliants and it may get the medias attention. If they do rise the per kWh rate in the near future, it will effectively be a two stage price rise which doesn't get as much attention as a single big rise. Perhaps very clever of them.

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lchiu7

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#998413 3-Mar-2014 20:57

Geektastic:
dwl:
Aredwood:
Geektastic: Whilst we are on the subject...

WTF is the levy we pay to the Electricity Authority actually doing for us as consumers?

They run the "whats my number" website and advertising.

In otherwords you have to pay more on your powerbill, just so they can tell you to try and save by switching companies.

I assume it is this amount: Electricity Authority Levy of 0.146 cents per kWh. At 8000 kWhr/yr that's $13.40 inc GST no prompt payment discount. While I'd rather not pay it, at 0.5% of my bill it isn't the main concern.

But what IS it?!

if 2 million bill payers all cough up $13 a year thats a fair sum for a couple of infantile websites that don't really help.

The levy consumers pay is a small amount of the total levy. Most comes from levies directly against generators, line companies and retailers, From the Electricity Authority SOI the following table shows how the levy is spent.

As you can see most of the money goes to paying for the service providers who include

Transpower (aka System Operator) who run the the national grid
NZX who run the wholesale and spot electricity market (noted as clearing manager, WITS, pricing manager etc.)
Registry (Jade) who run the database of meters (ICP's) and who are responsible for keeping track (among other things) which retailer is serving which customer).

What's my number is only a small part of the overall expenditure.

As an aside the increases as noted are all due to the Wellington Networks and passed on to a greater or lesser extent by the retailer. As a monopoly WEL's charges are regulated by the Commerce Commission who specify (from what I am told) a maximum return on investment, not a price control. So if WEL keeps to this number, they can charge whatever they feel is appropriate. No idea why they decided to raise it now unless they got some increase through the Commerce Commission.

How retailers pass that on is up to them. I am with Genesis and my line charge is going up as follows.

So my line charge goes up from 101c to 183.91 (before GST) but my anytime rate drops from 23.5 to 21.92. I have to perform some analysis on previous bills to see what different that's going to make but I also am going to call other retailers for comparison.

Staying in Wellington. Check out my AirBnB in the Wellington CBD. https://www.airbnb.co.nz/h/wellycbd PM me and mention GZ to get a 15% discount and no AirBnB charges.

sbiddle

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#998426 3-Mar-2014 21:09

It's certainly going to screw with the Green party and their solar plans. I'm surprised they haven't called for an inquiry.

dwl

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#998434 3-Mar-2014 21:25

lchiu7:
..snip ..
As an aside the increases as noted are all due to the Wellington Networks and passed on to a greater or lesser extent by the retailer. As a monopoly WEL's charges are regulated by the Commerce Commission who specify (from what I am told) a maximum return on investment, not a price control. So if WEL keeps to this number, they can charge whatever they feel is appropriate. No idea why they decided to raise it now unless they got some increase through the Commerce Commission.
..snip..

There are details of these determinations here on the Commerce Commission website with a wonderful title of "Resetting the 2010-15 Default Price-Quality Paths for 16 Electricity Distributors". The website intro is here and includes links to submissions and comments from lines companies. The document intro says "The main impact of this decision will be on the maximum prices that each of these suppliers can charge between 1 April 2013 and 31 March 2015."

There are statements for the 1 April 2013 to 1 April 2014 year like:
Table X1: Allowable rate of change for each supplier
Wellington Electricity CPI-0%

There are many factors involved, including "Note that the changes shown refer to the average change in the price that suppliers are allowed to
charge, prior to any claw-back amounts being applied. Suppliers may increase their prices at a faster rate if they choose to price below the price cap in the preceding year." I imagine most of us can't be bothered extracting the fine details from the 170 pages.

My biggest concern, which might apply to others on this forum, is I have a second power connection for the sole purpose of power to a modem and wireless link from a deep shaded valley. It was a marginal call to go with mains compared to solar (existing transformer was very close so minimal install cost) and I am now concerned that the monthly charge will shoot up (usage is nothing). As it isn't primary residential it doesn't qualify for low user option.

dwl

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#999734 5-Mar-2014 19:53

Got my answer today in the mail about Genesis rises on the low use non-primary-residence connection. These are ex GST before prompt payment discount:

Certainly more than CPI increase but not so much urgency to get a solar alternative working.

Aredwood

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#999899 6-Mar-2014 00:13

Im hardly surprised that this is happening. Each year the number of electricity connections increases, Yet the total amount of electricity used doesn't change much. This means that the average amount of power used per connection must be dropping heaps. Also the amount of power that is used at bad power factors is also increasing alot. Therefore increasing fixed costs yet not as many units used combined with bad power factors - which take up network capacity that in not billed to residential customers.

And then you have people reducing their baseload consumption due to more efficient appliances, not leaving things like heated towel rails running 24/7, unplugging appliances instead of leaving them on standby. And the lines companies relaxing rules on load magement, lowering the price difference between day and night rates. Not allowing new night rate connections. (at least in the Vector area) This means the Peaks in demand at morning / night are getting bigger.

Therefore lots of generation capacity is still needed to meet these peaks, Yet late at night there is often lots of spare renewable generation capacity. And the peaks will only get worse when electric cars become common. Everyone arrives at work, Plugs in their electric cars to recharge. They get home in the evening, and plug them in again. Remembering that Lithium ion battery’s are often charged from 0% to 80% full in the first 1/2 of the total charge time.

As for the greens solar panel scheme, there has already been a study done that found that it is better to subsidise the building of wind generation capacity, than it is to subsidise solar hot water. Cant imagine that Solar PV would be any different, Since peak demand never coincides with peak strength in solar radiation.

In my own house almost all power gets used solely on electric motors and electronic devices. My average power factor is probably around 0.6 And since my last power bill was for 673 units, I would have actually used the same network and power station capacity as if I had used 1121 units. And if I assume a 0.5 power factor then my equivalent units would have been 1346 units.

dwl

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#999942 6-Mar-2014 08:19

Geektastic: Whilst we are on the subject...
WTF is the levy we pay to the Electricity Authority actually doing for us as consumers?

Looks like it is being put towards an investigation. On Morning Report there is audio here about:

"Electricity Authority to investigate power price hikes - As electricity retailers and lines companies point the finger of blame at each other the Electricity Authority will try to find out why power prices are rising. Electricity suppliers, including Contact Energy and Genesis Energy, say the blame lies with the lines companies"

I doubt whether we will learn much more than can be got from the reports but at least consumer concerns have been heard. Now the long wait for the answer.

sbiddle

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#999943 6-Mar-2014 08:25

dwl: Got my answer today in the mail about Genesis rises on the low use non-primary-residence connection. These are ex GST before prompt payment discount:

Certainly more than CPI increase but not so much urgency to get a solar alternative working.

These changes start to completely destroy any cost benefit from solar? Storing power still isn't cost effective so those with solar are still relying on a grid feed, and feeding some electricity back into the grid. Higher line charges mean the ROI simply gets far worse.

dwl

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#999951 6-Mar-2014 08:46

sbiddle: These changes start to completely destroy any cost benefit from solar? Storing power still isn't cost effective so those with solar are still relying on a grid feed, and feeding some electricity back into the grid. Higher line charges mean the ROI simply gets far worse.

I agree these changes are bad for high usage homes. The reduction in per kWhr charge is likely to mean a reduction in the exported rate and the saving per kWhr for avoiding imported power also scales back.

However, the low use residential rates have the regulated daily charge (capped at 33c/day) which has now been hit with a higher per kWhr charge (to pay for lines company increases) so that should make grid tied solar more attractive. I would have thought that those with grid tied solar (e.g. like this one) may be on that low use plan, especially with any reasonable size of array.

The biggest challenge with ROI is the lack of any guarantee of exported credit rates. Unless some assurances can be given it remains a marginal risky investment.

My telecommunications example above (power just for equipment - modem and wireless) is where solar gets more attractive but as the daily rate hasn't doubled it isn't as bad as I had feared. Solar options are getting a lot better although my challenge is on cloudy days in a shaded valley floor the panel is probably only putting out about 10% of capacity so for winter might stay with grid fed.

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