Auckland gas bills may be cut
Wed, 24 Oct 2012 10:44a.m.
Vector's gas customers in Auckland and elsewhere face a $4.60 cut to their monthly bill, under a new proposal from the Commerce Commission.
The network owner would have to accept a 25 percent cut to its transmission charges for gas pipelines under a revised draft decision from the regulator.
The proposed changes which would establish the biggest adjustments that would start on July 1 next year. After that, prices would be adjusted by the rate of inflation through until 2017, it said in its revised draft decision.
Vector has been battling the changes with a court challenge. The changes provide some winners and some losers.
Powerco, for example, could raise prices in its distribution by 5 percent.
Vector's distribution prices for its Auckland network would be cut by 16 percent, while GasNet would face a two percent distribution cut and Maui development would enjoy a two percent transmission increase.
For customers of Vector, the reduced distribution charge would amount to a $4.60 cut to the monthly bill for the 143,602 residential gas users in Northland, Greater Auckland, Waikato, Bay of Plenty, Rotorua, Taupo, Gisborne and Kapiti.
Powerco's users would face a 60 cent increase and those of GasNet in Whanganui would enjoy a $1.10 decline.
"This is the first time that some of these businesses have been subject to price-quality regulation," commission deputy chairwoman Sue Begg said.
"We are now bringing the prices these businesses can charge their customers more into line with the costs of providing those services."
Ms Begg said that while the reductions for Vector were "substantial" the commission doesn't expect this to limit its ability to invest in or maintain its network.
Vector chairman Michael Stiassny said this month that the commission was imposing price cuts on Vector using a flawed methodology that risks undermining investment in critical public infrastructure.
Parties have until December 7 to make submissions on the revised draft decision.
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