McClay Todd: Debate on Crown Entities Public Organisations and State Enterprises — In Committee 
Text is incorporated into the Bound Volume 
McClay Todd: Debate on Crown Entities Public Organisations and State Enterprises — In Committee 
[Sitting date: 29 June 2010. Volume:664;Page:12242. Text is incorporated into the Bound Volume.] 
TODD McCLAY (National—Rotorua) 
: 
 It gives me pleasure to stand and speak in this debate and in particular to talk about Mighty River Power. Before I do I will make a few general comments then come on to talk about Mighty River Power and about some of the work it is doing in my electorate and the wider Bay of Plenty. We have heard from the very hard-working member of Parliament for Taupo Louise Upston about the work that Mighty River Power has been doing in the Waikato and in her electorate. 
Stakeholding Ministers are custodians of $25 billion worth of investments by taxpayers in State-owned enterprises which represents slightly more than 20 percent of the net worth of the Crown. Additionally State-owned enterprises hold about $47 billion in assets and paid just over $647 million in dividends in the 2009 financial year which included $150 million in special dividends from both Meridian Energy and Mighty River Power. The responsibility of stakeholder Ministers is to ensure that this investment delivers an appropriate return and we have heard from the Minister that to date the returns have been unsatisfactory although improving. 
For the whole State-owned enterprise portfolio there are annualised returns of 1.5 percent for the 6 months ended 31 December 2008. We have had record low interest rates under this Government but if some of that money had been just put in the bank during that time there might have been a higher return. That rate of return increased to 4.4 percent for the 6 months ended 31 December 2009. However stakeholder Ministers consider that there is still plenty of scope for improvement in this area and Ministers and officials will continue to work with individual State-owned enterprises during the current business planning round to develop appropriate performance expectations. I believe that the New Zealand taxpayer would encourage Ministers and officials to do just that. 
I come now to Mighty River Power. I was doing a bit of research before my speech today and I found that in the 2008-09 period Mighty River Power generated revenue of $1.1 billion and made a post-tax profit of $160 million. Its subsidiary companies contributed $43 million but incurred some losses and in its annual return Mighty River Power indicated that it would pay an ordinary dividend of almost $80 million representing 50 percent of the net profit after tax. 
I will come to my electorate of Rotorua and talk about some of the work that Mighty River Power is doing there particularly in the geothermal electricity generation field. In the 2008-09 financial year Mighty River Power’s renewable generation rate increased by 36 percent and its geothermal production increased from 9.5 percent to 20 percent. The geothermal power station at Kawerau was opened at the end of November 2008 which was a very good month for my electorate and at the time that station represented the largest geothermal development in New Zealand for 20 years. I notice that that power plant in Kawerau was revalued on 30 June last year at $500 million which is an increase in value of $240 million. I recognise and congratulate Mighty River Power on completing that project well ahead of schedule and certainly under budget. 
Hon Trevor Mallard 
: What a good Minister. 
TODD McCLAY 
: Absolutely. That very good Minister is sitting in front of me now. Last year the geothermal power station at Kawerau received a top national award for the work that it did and Mighty River Power won the electricity supply industry Engineering Excellence Award during that year. Of course a lot of local people had come together to make sure that that could happen such as local iwi owners of land the two pulp and paper plants and the industry and it is good to see a local community joining together. There is 100 megawatts of baseload electricity produced in that small plant—100 megawatts of baseload. 
Dr Rajen Prasad 
: How much is that? 
TODD McCLAY 
: That is more than the electricity in the batteries the member uses in his radio when he listens to Parliament at home. 
That plant was only the first of the new plants to be opened. Louise Upston mentioned earlier an investment in Nga Awa Purua Geothermal Power Station north-east of Taupo and I notice from my notes that the electricity generated in this power station—