Tremain Chris: Electricity (Disconnection and Low Fixed Charges) Amendment Bill — In Committee 
Tremain Chris: Electricity (Disconnection and Low Fixed Charges) Amendment Bill — In Committee 
[Volume:646;Page:15535] 
CHRIS TREMAIN (National—Napier) 
: 
 I rise to take a call on clause 4 “Low fixed charge tariff option for domestic consumers” and to pick up where the Minister in the chair the Hon David Parker left off with regard to the prices of Maui gas and their impact on that low fixed charge. I would like the Minister to listen to two points that I have heard in my constituency around low fixed charges. I had a meeting funnily enough on Friday with a constituent Mr Ralph McKenzie who wanted me to go to the Unison lines company with him to question Ken Sutherland from Unison about the low fixed-charge rate. His concern was about the way that pricing is disclosed in the low fixed-charge tariff. The Minister will appreciate that both a fixed and a daily charge appear on everyone’s bill. Well my constituent’s concern was that in the 2006-07 year his entire power bill went up by 7 percent which was quite a bit above the rate of inflation. But when he started to get down to brass tacks and tried to uncover whether the rise was due to the fixed portion or the daily charge portion he contacted Unison because he figured that the fixed portion of the low fixed-price charge was to do with lines companies and the distribution of power. 
In fact he found that the fixed portion had gone up. Overall it had gone up by 24 percent but Unison claimed that its daily rate had gone up only a couple of percentage points from that and that overall the increase of the fixed charge was due to Contact Energy and to the increase in prices for gas from the Maui field. I am not sure how the average consumer is supposed to get to the bottom of that because it is not disclosed very clearly. When my constituent got in touch with Contact Energy the company wrote him a letter stating that the price rise was due to the Maui gas field running out and the explanation the company gave him was that the costs were increasingly becoming a fixed cost and not a daily use charge. So I would like the Minister to explain that to me because I am still not sure how that was not part of the daily rate but became part of the fixed cost. So that is something for the Minister to answer and I would be interested in knowing that. 
The second thing around the daily use charge which impacts low-use users is something that happens particularly with a lot of my constituents in Hawke’s Bay. Although Hawke’s Bay presents a go-ahead sort of image we have an underbelly of people who are struggling. I have constituents in Maraenui. I was at a meeting with members of the Maori Women’s Welfare League the other day and their biggest concern about this low fixed-charge tariff industry with regard to Housing New Zealand Corporation properties is the double energy use they have. People have a gas line plus an electricity line into the house and they have fixed daily charges on both those units. The problem is that all the appliances in Housing New Zealand Corporation homes are geared to both gas and electricity. It is a situation where people who are not making a lot of money who are on benefits or low wages are having to pay a double fixed-use charge. Right now the Housing New Zealand Corporation is not looking to do anything to mitigate that situation but it is another issue that I would appreciate the Minister’s comments on. It presents issues under clause 4 to do with the low fixed-charge tariffs. 
Those are the two things I would appreciate the Minister’s comments on. How does a company like Contact Energy justify those price increases and make that a part of the fixed cost as opposed to the variable daily charge—I would be really interested in the Minister’s comments on that—and how do we enforce better disclosure of that information to consumers? Secondly I would like him to comment on the charges that poor underprivileged people are having to deal with in Housing New Zealand Corporation homes with regard to the two sources of energy going into those homes—the reason for which for the life of me I cannot understand. Thank you. 
Clause 4 agreed to.