11. Question No. 11—Energy and ResourcesTEANAU TUIONO (Green) (remote) to the Minister of Energy and ResourcesQuestion No. 11—Energy and Resources11. TEANAU TUIONO (Green) (remote) to the Minister of Energy and Resources: Does she think that a nearly 60 percent increase in the combined profits of the four major electricity companies suggests the electricity market is delivering fair power prices for New Zealanders?Hon Dr MEGAN WOODS (Minister of Energy and Resources) (remote): I have long signalled my view that the market is not working perfectly for everybody. I do note that if you unpack the combined 60 percent increase in profits number the member is referring to the underlying operating profits increased by 1.8 percent. I'm concerned about the impact of recently high wholesale electricity prices flowing through to businesses and potentially to households in the future. Recent wholesale price increases have been attributed to constraints in the gas production system and the need to use more coal last year as hydro lake levels were unusually low. This highlights to me why we must transition our electricity system away from fossil fuels and why I am investigating an enlarged pumped hydro scheme and similar options to help with that objective. Last year I spoke with the Electricity Authority about the effectiveness of competition in the wholesale electricity market. They are now investigating the wholesale market and I look forward with interest to the authority's report. Despite my ongoing concerns about the wholesale market I am pleased with the progress the Government is making following the Electricity Price Review to promote fairer electricity prices.Teanau Tuiono: Is she concerned by the findings of a Consumer survey last year that claimed 18 percent of Kiwis had trouble paying their monthly power bills and one in 10 Kiwis have been refused service by a power company because they have missed payments?Hon Dr MEGAN WOODS: It was precisely those concerns around energy hardship that led our Government in the last term to carry out the Electricity Price Review. The findings of that review identified that there were a very large number of New Zealand households that were experiencing problems with their power bills and why we've put in place measures to address some of that hardship. What I do ask the member to do is when he hears that—all members of this House for people that cannot pay their bills—not only to seek the normal support with paying the actual bill but to look into options for reducing power bills through initiatives such as the Warmer Kiwi Homes the insulation and efficient heat source. That of course can be accessed through the Energy Efficiency and Conservation Authority (EECA) and I invite members to get constituents to call 0800 749 782.Teanau Tuiono: What is the Government doing to incentivise energy efficiency the uptake of household solar and to ensure low-income families do not suffer energy hardship in light of the removal of the low user tariff?Hon Dr MEGAN WOODS: The removal of the low user fixed charge will actually result in 60 percent of New Zealand households getting fairer pricing for their electricity. I know that a number of the families that I represent are large families that live in homes that aren't as well insulated as in some other parts of the country or indeed my city and those people will actually have fairer power bills as a result. But for those people that are coming off the low fixed-user charges there are a number of supports in place. As I indicated there is support for families through things such as the Warmer Kiwi Homes programme. We've also done the work through making sure that homes are insulated when they are rented with the change in standards there and I encourage people that are struggling with their power bills to contact EECA.Teanau Tuiono: What alternatives if any did she consider to phasing out the low user tariff and would any of these have reduced electricity costs for large low-income households while promoting energy efficiency?Hon Dr MEGAN WOODS: The decision to phase out the low fixed-user charge was of course a recommendation of the Electricity Price Review which was aimed very much at the concerns that the member is sharing in the House here today which is around those families that are experiencing energy hardship. For reducing costs larger families who aren't low users because of the nature of the size of their family and their homes will more potentially be better off under their changes. They will not be cross-subsidising people like myself who live in a smaller family unit in a very well-insulated house. So they will be better off under those. In terms of energy efficiency that is something the Government is putting a lot of work into I refer the member again to the answers in regard to Warmer Kiwi Homes.Teanau Tuiono: Do the excessive profits gained by electricity companies indicate that the response to the Electricity Price Review does not go far enough and will the Minister commit to bolder reforms including to the wholesale market?Hon Dr MEGAN WOODS: As I outlined to the member in the answer to the primary question I am awaiting a report on the wholesale market from the Electricity Authority and further advice. But I do caution the member about using the 60 percent combined profit figure that was the headline in a recent media article that actually if you dig into it what it includes is Mercury's sale of its share in Tilt Renewables and the combined net profit falls slightly to 412 million which is actually less than the period before. As I said it is actually a 1.8 percent increase in operating profit but that does not mean I am not continuing to look at issues around the wholesale electricity market.