Cosgrove Clayton: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Cosgrove Clayton: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 20 June 2012. Volume:681;Page:3130. Text is incorporated into the Bound Volume.] 
6. 
Hon CLAYTON COSGROVE (Labour) 
 to the  
Minister of Energy and Resources 
: Does he agree with Molly Melhuish’s calculation that the amount charged by SOEs for electricity for an average consumer is $265 per annum less than is charged by non-SOE retailers and if not what was the weighted average of the annual total retail price charged by SOEs and their subsidiaries to a residential consumer using 8000 kilowatt hours of electricity compared with the weighted average of the price charged by non-SOE suppliers according to the most recent data? 
Hon TONY RYALL (Minister of Health) 
 on behalf of the Minister of Energy and Resources: No. As I am advised a number of errors were included. For example the calculations assumed Mercury Energy has 19188 customers when in fact it has 364600 customers. This is a surprising 18-fold underestimation and this makes a material difference to the weighted result. I have today received two pieces of advice from the Ministry of Economic Development. Results can vary because of the assumptions used such as payment method payment time and location and whether or not you count for example the significant rebate paid to TrustPower customers in the Tauranga region. So members should accept the information with that in mind remembering that no one gets this weighted average price; it is competition in your town or suburb that matters the most. Using the assumptions made by Mrs Melhuish and correcting the errors the latest available data I am advised has the two figures as $2113.60 and $2332.00. However I have been advised that with a more comprehensive set of assumptions including taking into account the full range of payment method and payment time discounts—and frankly in the real world that is what you do—officials advised a different result. Those figures are $2113.60 and $2101.60. The private electricity companies are cheaper by $12 a year. 
Hon Clayton Cosgrove 
: Does— 
Mr SPEAKER 
: Order! I apologise to the member. I must be able to hear the supplementary question. 
Hon Clayton Cosgrove 
: Does the Ministry of Economic Development quarterly survey of electricity prices for a customer using 8000 kilowatts a year show— 
Hon Gerry Brownlee 
: Hours. 
Hon Clayton Cosgrove 
: —kilowatt-hours a year; thank you Gerry—that averaged across all the State-owned enterprises across all private companies across all regions all seasons all lake levels and all types of generation State-owned enterprises charge on average less than private energy companies? 
Hon TONY RYALL 
: I have just answered that question. Depending on the assumptions that you use you get a different result. What I would direct the member to do is look at the latest Powerswitch website because as I said it is price competition in your town in your street and in your road that matters. What we are aware of is that in 14 of the 21 regions listed on the Consumer Institute’s Powerswitch website the cheapest electricity company is privately owned one of them is council owned and the other six are State-owned enterprises. The important thing here is not the ownership of the companies; it is the level of competition in your community and 425000 New Zealanders have switched power companies in recent times. 
Hon Clayton Cosgrove 
: Does he stand by his statement to the House yesterday that he is aware of the Ministry of Economic Development website: “I am aware of the prices on that website” and “private companies are currently the cheapest in Auckland Central”? 
Hon TONY RYALL 
: I am sure the Minister would stand by whatever he says in the House and I would certainly agree with him. If you do look at the Consumer Powerswitch website the cheapest companies we have been advised in central Auckland and Manukau Hamilton Christchurch and Dunedin are private companies. 
Hon Clayton Cosgrove 
: Does the Ministry of Economic Development website say that the lowest price charged in the Vector central Auckland area is offered by Genesis’s subsidiary Energy Online and that the lowest price charged in the Waitemata area is offered by Meridian Energy? 
Hon TONY RYALL 
: That could very well be the case when that information was put on the ministry’s website and I think it is based on May. Looking at that information as I did earlier today those rankings change all the time and what prices are being offered. If members look at the latest Consumer Powerswitch website—which is quite easy to understand; it has charts of what the offered prices are—that will demonstrate to you that of the 21 power regions identified in 14 the cheapest company is private. But I must remind the member that it is not the ownership of the company that matters; it is the level of competition to drive down prices. That is why over 420000 New Zealanders have switched their suppliers. If they had had the ability to switch when Labour put up the power prices by 72 percent over 9 years I think we would have seen millions switching. 
Hon Clayton Cosgrove 
: I seek leave to table data from the Ministry of Economic Development— 
Mr SPEAKER 
: Is this off the website? 
Hon Clayton Cosgrove 
: No this is data from the domestic electricity prices— 
Mr SPEAKER 
: I apologise to the member. 
Hon Clayton Cosgrove 
: It is dated 15 May 2012 and shows that the lowest prices in central Auckland are charged by Genesis’ subsidiary Energy Online and Meridian Energy. 
Mr SPEAKER 
: Leave is sought to table this document that I am told is not off the website. Leave is sought to table it. Is there any objection? There is no objection. 









Document by leave laid on the Table of the House. 
Te Ururoa Flavell 
: Kia ora tatou katoa. What work has been done following the report into the death of Mrs Folole Muliaga to address the issue of security of supply to people on very low incomes; and will he agree to consider the relevance of the UK experience where there have long been subsidies and assistance to avoid people falling in the fuel poverty trap? 
Hon TONY RYALL 
: Yes I am aware of the very tragic circumstances around Mrs Muliaga who was a customer of Mercury Energy which is owned by Mighty River Power—very sad circumstances that led to a new protocol being put across the electricity sector both public and private particularly in dealing with those customers in vulnerable positions and particularly around their health. 
Hon Clayton Cosgrove 
: When he declined to answer yesterday’s question about the average price charged by private providers and the average price charged by State-owned enterprises had his officials provided him with draft average figures or did he even ask for those average figures? 
Hon TONY RYALL 
: As I am answering on behalf of the Minister in the House I am unable to give an answer to that question. What I would say is that it is quite clear in the work that I have done this morning that there are a lot of assumptions that need to be made behind these various modellings. What has become very very clear to me in looking at all this evidence is that it is not the ownership that matters it is the level of local competition. Four hundred and twenty-five thousand New Zealanders have switched power companies as a result of that website and of the greater competition that has been brought in. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. With respect Mr Speaker you have been a former Minister and you will be aware of the basic briefing processes. One would have assumed that— 
Mr SPEAKER 
: Order! The member asked his question and the Minister said he did not have that information to answer that question. As Speaker I cannot second-guess an answer like that. That is a perfectly proper answer to a question and if the member happens to disagree with it he can ask further questions about it but I cannot enter into a dispute about whether the answer is right or wrong. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. I seek your advice. Given that fair point that you make one wonders why those members denied leave for that question to be put. 
Mr SPEAKER 
: Order! The member cannot dispute this kind of thing by way of a point of order. It is absolutely any member’s right in the House to deny leave for any course of action where leave is sought.