Written By: Ben Clark - Date published: 2:28 pm, June 19th, 2012 - 81 comments

Categories: capitalism, Privatisation - Tags: asset sales, electricity, Tony Ryall

Independent energy analyst Molly Melhuish is putting out some facts that Tony Ryall will not find comfortable.

While Ryall is spouting that 400,000 New Zealanders switching electricity provider proves that the market is working, Molly points out that we pay on average 28.1c per kWh from private companies and 24.79c per kWh from state owned companies – residential customers pay on average 25.05c.

So as we all look forward to our electricity companies being sold off and paying 28.1c (plus – they’re rising by $64 for the 3 months of winter this year and expected to keep going up for a couple more years), we can also look back and see how well the commercial model has gone.

In the last eight years the typical family power bill went up 78% according to Consumer NZ; over 30 years commercial customers have had their rate drop 37% in real terms, and industrial customers 3%. It’s normal Kiwis that are being squeezed.

And far more than they are across the ditch and across the Pacific. US customers pay on average 15.16c per kWh, and Australia around 15c too. If our market is so great, how come our companies are so expensive?

Worse than the dollar cost though is the human cost. Otago University research says that 1600 more people (four times the road toll) die in winter than other seasons. This will be down to inadequate heating producing poor health.

So is the market working Tony Ryall?

And why is the asset sales process being rushed through parliament, before Treasury can analyse Molly Melhuish’s research?

Is it because evidence doesn’t matter?

[edit: added link to Molly Melhuish’s submission]

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