Will Lianne allow Orion to price gouge?

Mike Yardley at The Press writes:

Orion’s odious proposed price hike, which would gouge an extra $1000 off every Christchurch customer, over and above its existing 25 per cent share of power bills, has run into a brick wall.

The Commerce Commission’s draft report has virtually halved the scope of Orion’s planned cash-grab, while also noting that the community-owned lines company does not have to proceed with this increase.

No-one disputes the critical infrastructure repair and enhancement programme Orion has embarked upon.

But there are alternative ways to pay the $150 million bill for this 10-year project.

As the Earthquake Recovery Minister, Gerry Brownlee, has pointed out, the company’s balance sheet is very strong, its cash reserves are healthy – and Orion has generated $220m in profit in the past five years alone.

Brownlee has described Orion’s proposed price hike as “an appalling slap in the face to the community, by a council-owned company that is behaving like a rapacious capitalist”.

Well that is a clear stance by Gerry. But what about Lianne Dalziel? Are Labour not against price gouging by electricity companies?

So what is the position of our mayoral aspirants?

And should they be successful on October 12, what pressure will they apply on Orion to abandon this lazy financial assault on a captive market?

Paul Lonsdale swiftly responded to me, pledging to negotiate with Orion’s board to abandon the proposed increase.

But Lianne Dalziel took umbrage at my inquiry as to whether she would lean on Orion to jettison the increase.

Instead, I was emailed a diversionary missive from the red-hot mayoral favourite as to why Orion was an “over my dead body” strategic asset which must be protected.

So is Lianne saying that she supports Christchurch people paying an extra $1,000 a year for power, so long as she owns the company and can get to spend the dividends?

Dalziel also fired off a chapter and verse broadside about why the power retailers are the real “villains”. (Although, unlike the retailers, the customer can’t shop around for a lines company. And, unlike the lines company, the council has no control over power retailers.)

Retailers have competition, and effective competition also. Hundreds of thousands of people swap retailers when they can get better offer. Why would Lianne ignore the monopolist lines company? Oh, maybe because is she becomes Mayor their profits can fund her spending plans?

Of course, all of this is a big fat red herring by the mayoral contender and, surprisingly, Dalziel declined to give me a straight answer on whether she specifically supports Orion’s desire to fleece an extra $1000 out of your backpocket.

It seems like a very reasonable question.

Comments (15)

Login to comment or vote

Add a Comment