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Tuesday, 15 July 2014

Electricity market competition is working

New power price data released today shows the Government’s 2010 electricity reforms are making a real difference for consumers. The market is now really working for New Zealanders.

The reforms introduced important changes in the electricity sector which have significantly improved competition. We have promoted consumer switching between electricity retailers and, on average, consumers can save $155 per year on their power bill by switching. We are seeing unprecedented discounting offered by retailers. We have encouraged new entrants into the market.

Sales data released today (reflecting what consumers actually pay for their power) shows, to the year ending March 2014, the lowest annual price increase since 2001 (2.3%).

Since National took office in 2008, we have halved the power price increases seen under the last Labour Government.

Data for the latest June quarter has also been released, showing the energy component of the bill (the part subject to competition) has decreased.

Alongside introducing competition and helping to bring the runaway power price rises of the 2000s under control, National has also made much-needed investment in infrastructure to ensure the lights stay on. And we continue to be among the best in the world for renewable electricity generation, with 75% generated from renewables in 2013 (up from 65% in 2008). It's our goal to get to 90% renewables by 2020.

The Labour-Greens "NZPower" plan, giving politicians control of the electricity market, would put all these gains at risk. It would do nothing to lower prices or promote competition, and would be a threat to security of supply and the continued growth of renewable generation.

Competition is the best way to keep downward pressure on prices and we will continue to promote competitive and innovative measures in the electricity market.