7. Question No. 7—Energy and ResourcesJONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and ResourcesQuestion No. 7—Energy and Resources7. JONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and Resources: Does she think New Zealand households and companies will be paying lower electricity prices in a year's time?Hon Dr MEGAN WOODS (Minister of Energy and Resources): The price they pay will depend on a range of factors. These factors include the amount they use retail overheads distribution costs the wholesale market transmission charges and any other contractual terms that may apply. However I am aware of two trends putting downward pressure on prices. We are seeing $650 million being invested in new renewable generation over the coming year which means lower prices for New Zealanders over the long term because these have the lowest levelised cost. The Government has also started implementing the recommendations of the Electricity Price Review which Consumer New Zealand has said could save low-income consumers $40 a month off their power bills. I am pleased to report in the months since the interim report was released $5 million has already been returned to the pockets of consumers.Jonathan Young: Does she think that household electricity prices can drop over the next year given the wholesale price as she mentioned as a component of every household bill has been on average 60 percent higher every day for the first nine months of this year compared to last?Hon Dr MEGAN WOODS: I'd like to remind that member again that there is no reason to think that higher wholesale rates will necessarily flow through to retail rates. I remind that member again that it didn't in 2017 when we saw prices in the $300 range per megawatt hour. I'd also like to tell that member that I am confident that we will see price drops because as I told him in the answer to the primary we have already seen $5 million flow back into the pockets of consumers and the Electricity Price Review said that if all companies do away with their late payment fees we could see $45 million flow back into the pockets of consumers.Jonathan Young: Considering in her response that that peak she mentioned in 2017 was for one day only what is her response to Energy Link director Greg Sise's comment that there is a general realisation that gas market dynamics have changed for good and the price of gas is a big driver of the price of electricity on average so higher prices for electricity look more likely to stay for a good while longer?Hon Dr MEGAN WOODS: Because he is not the only commentator out there and there are multiple commentators that are saying that a renewable future actually is the way in which consumers will see the lowest cost of electricity.Jonathan Young: What does she say to another commentator John Kidd of Enerlytica who said Compared to two years ago year-to-date wholesale electricity and gas prices are each 70 percent higher … While the Government has dismissed this as a short-term aberration we are much more cautious."?Hon Dr MEGAN WOODS: What I say is that John Kidd is also saying that the right signals are being sent around the time to invest in renewable energy. That's why I am thrilled to see that we've had $650 million worth of investment in renewable energy projects this year which had the lowest levelised cost of electricity which will return for consumers in the long run.Jonathan Young: Does she continue to deny that the gas market dynamics driven by her Government's policies are impacting the long-term wholesale prices and that this is starting to impact the decision making of companies like the owners of Tīwai Point Aluminium Smelter?Hon Dr MEGAN WOODS: That member is drawing a ridiculously long bow. If he was to listen to any of the commentary of what the smelter are saying they are not talking about their contracted price that they have with Meridian because of course they are protected by volatility in the wholesale market through their long-term contracts with Meridian. What they are talking about in terms of their electricity pricing is of course transmission."