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Excessive profits must spur Government to rein in gentailers
The proof in today’s Commerce Commission report that electricity generators are squeezing consumers to make excessive profits should force the Government to look at innovative solutions, said REFIT-NZ today.
“This is a great opportunity for the Government to be bold and give consumers more power over their electricity futures as many other countries are doing,” said REFIT-NZ Chairperson Charmaine Watts. REFIT-NZ is a community-based organisation that wants to educate New Zealanders about measures the rest of the world is adopting to deal with problems around security of energy supply and rising power bills. “The current electricity market clearly favours a centralised generation monopoly regime, which means electricity consumers have very little control over their electricity, whether buying or selling,” said Ms Watts.
“It is time New Zealand caught up with the rest of the world by introducing Feed-in Tariffs (FITs) to level the playing field for clean renewable energy. FITs reduce consumer dependence on generatorretailer monopolies and don’t cost the Government anything.
“The sooner New Zealand adopts FITs, the easier and cheaper it will be for New Zealanders to generate more of their own electricity from small scale renewable sources like solar PV, hydro and wind power and so reduce the huge profits of generator-retailers.”
FITs require electricity retailers to pay consumers who produce their own renewable electricity and feed it into the national grid, a premium above normal retail rates. That way investments in renewable energy systems can be paid back much quicker. The cost is spread over all consumers.
“FIT policies have been legislated in 63 countries, states and provinces around the world including Australia, Britain and Germany,” said Ms Watts. “It’s been empirically proven time and again that no policy delivers more renewable energy, faster, cheaper and more equitably. It also results in numerous direct and indirect benefits for all consumers.”
New Zealand is one of the few countries in the world where rates of renewable energy generation have been declining for many years, yet it is widely acknowledged that New Zealand is well positioned to be 100 per cent renewable.
“We are so awash in renewable resources that the Government set a seemingly impressive voluntary target of 90 per cent electricity being generated from renewables by 2025. Yet unlike many OECD countries, New Zealand has no specific renewable energy policy to increase the uptake of small-scale renewable electricity production. One has to ask exactly whose interests are being looked after?” said Ms Watts.
“Our renewable resources could meet almost double the country’s electricity demand, while our large hydro storage capacity could be easily utilised to smooth out the intermittent nature of renewable electricity supply.
“If we can rush through greater Auckland becoming a Super City in quick smart time, I don’t see any reason why the same cannot be done for FITs. It would be an easy win-win for consumers and the environment.”