Mahuta Nanaia: Electricity Industry Bill — Second Reading 
Mahuta Nanaia: Electricity Industry Bill — Second Reading 
[Volume:665;Page:12476] 
Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) 
: 
 I rise to speak to the second reading of the Electricity Industry Bill and submit Labour’s opposition to it based on three key points: firstly the bill fails to balance the priorities of security and supply in transmission; secondly the bill fails to achieve affordability for the consumer through greater predictability of pricing; and thirdly the bill is a light response to the real opportunity of achieving the sustainable production and use of electricity. 
Labour’s minority report is a good articulation of the key issues put forward by the previous Opposition spokesperson on energy Charles Chauvel. It is difficult to gain a sense of coherence about what the Government is trying to achieve in this bill on so many fronts. But the real question has to be the one that Kiwi families all around the country are asking. What will this Government do to get a handle on increasing power prices and will this bill actually lower them? [ 
Interruption 
] I will say it again for members. What will this Government do to get a handle on increasing power prices and how will this bill actually address that? Pensioners are feeling the pinch. Households with young people are feeling the pinch. Families with sick whanau are feeling the pinch and worrying about the next power bill over the winter period creates more worry and more frustration. This is a real issue facing Kiwi families right now and these are their questions. 
Labour’s minority report states that although this bill aims to improve competition in the electricity market and improve security of supply it does very little for consumers. Feedback from officials notes that such measures tend to put upward pressure on prices. The Minister of Energy and Resources would be hard-pressed to explain just how effective asset swaps amongst the big State-owned enterprises will be in addressing this question. One can only surmise that the real ambition is to prepare some State-owned enterprises for full or partial privatisation in the next term if National were to be re-elected. We find ourselves agreeing with the views formed that asset swaps increase the risk to electricity supply and will result in a loss of efficiency in some areas of electricity generation and that the cost-benefit case for asset transfer is unclear which view in part was supported by submissions from Transpower and the Institution of Professional Engineers New Zealand and by Treasury reports. 
There is a dogged ideological belief by the Minister and his Government that the market will better respond to pricing pressures. But will it fix what Kiwi households want? In several questions to the Minister Kiwi households wanted to know how this reform would lower their monthly power bill. The answer was that consumers should shop around. He certainly does not know some of the pressures on low and modest income households that are feeling the pinch. Many consumers join payment schemes that enable a bit-by-bit approach to paying off their monthly power bills. Some households that are feeling the pinch may have arrears on their power bills. There is no way that they can shop around until they clear their debts to the current providers so they become stuck in a situation where shopping around is not a real alternative that they can pick up on because they simply do not have the household income to bulk pay their monthly bills or any outstanding amounts. 
Worse still even if they do opt to change retailers it could take up to 6 weeks for a transfer to be effected. During that time some stress occurs because the household relies on a secure supply of electricity to their home. What if retailers have a communication breakdown and power is cut off before a new account starts? This is a particular concern for some elderly folk who are dissatisfied with their current supply but feel uneasy about going through the process of shopping around because they are not clear about some of the things in this whole process. There is no assurance from the Minister on this front. 
Some of the structural shifts effected by this bill compound the concern previously outlined. In fact to the layperson many of the changes proffered by the bill are a hotchpotch of measures that lack coherence or a plan. Coming from that Minister who changed the plan on the conservation estate and the mining of schedule 4 lands it should be no surprise. Despite the Minister’s assurances the Government has not updated the New Zealand Energy Strategy which he promised to do earlier this year. That is of real concern. Here we have a hotchpotch of measures that do not appear to be linked in any way to a big picture or vision for energy generation for a secure and sustainable supply and ultimately for better pricing conditions for Kiwi households. 
Most Kiwi households are not dogmatic about structural reform in this sector but they have some basic needs that should be understood. I am sure other constituent MPs will be hearing the same messages that I am hearing. Households want a secure supply of electricity to their homes. Households want a more predictable and accurate pricing structure. Households are open to incentives that promote energy conservation. Households would make better decisions around energy-efficient choices if there were better cost incentives. Labour is concerned that the Government is lukewarm on these concerns of real Kiwi households and it is lukewarm on the issue of renewable sources of energy when many Kiwi households are looking at more energy-efficient housing options to future-proof their existing homes. 
More important the goal of achieving 90 percent renewable energy should be more than as the Minister has said aspirational. It should be a goal that is actively worked on with some vigour by the Government. Maori are proactively venturing into the space of renewable sources of energy generation and electricity supply and are having greater regard for the health of the environment. It is all synonymous with the Maori world view. All new energy generation to meet the needs of a growing population should come from renewable sources. That signal alone will create new and different jobs and in some cases it will also build on and invest in our clean green image which we all boast about when we are overseas. 
Just briefly I want to comment on the removal of the Electricity Commission in favour of an Electricity Authority. One role the commission had was to provide coordination within the sector and to have oversight to ensure fairness and sustainability in the supply of electricity. The new authority will have no such oversight and this too is of real concern. Consumers who could previously take their concerns regarding fairness to the commission have nowhere to go or they have to go directly to the Minister. 
During the adjournment I received a complaint from a woman living in Nelson about the increase in her power prices from Contact Energy. She said that Contact Energy has raised its prices four times— 
Hon Parekura Horomia 
: How much? 
Hon NANAIA MAHUTA 
: —four times—in the last 20 months and she wants something done about it. She tried complaining to the current Minister and stated that no one will listen. Is this the way consumers expect to be treated? 
Will the Electricity Industry Bill lead to lower electricity prices? Will the Minister resign if power prices do not drop? This bill was commenced because of the pressure on households from increased power prices. The Minister put his credibility on the line saying that this type of reform will make a difference. Will the Minister resign if power prices do not drop? Labour is concerned about Kiwi households and the questions they are asking which are how we bring our electricity bills down and whether this bill will make a difference. Labour firmly believes that more can be done to alleviate pressure on Kiwi households and the cost of living pressures that they are currently facing. This bill is not the solution and we oppose it.