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Discount and Distribution Analysis: February 2008


[ Last Updated 18 March 2008 ]
Short Description The discount and distribution information presented represents discounts and distributions given by line businesses, and trusts owning line businesses, to residential consumers. Updated to February 2008.

Author Energy and Communications Branch

1. The discount and distribution information presented represents discounts and distributions given by line businesses, and trusts owning line businesses, to residential consumers. Money distributed to community groups, charities or to shareholders is not considered a discount or distribution in this context.

2. In some instances, the term discount may refer to a rebate. The term discount does not refer to a prompt payment discount. An unknown portion of the discount may relate to revenue from business activities other than electricity.

3. Discount and distribution information was obtained through a survey of line companies and their respective Trusts (where applicable) and relates to the year ended 31 March 2007.

4. Total line company charges are calculated based on an average (8,000 kWh per annum) consumer of electricity on the optimal (low user or standard) plan (pre discount and/or distribution), for the most common meter configuration.

5. The value in cents per kWh (c/kWh) of the discount and/or distribution is obtained by calculating the total amount received by an average consumer and dividing this amount by their 8,000 kWh annual consumption.

6. The c/kWh discount and/or distribution (as in Table 1) is subtracted from current line charges as at 15 August 2007 (refer to the Schedule of Domestic Electricity Prices). Additionally, the transmission component (paid by line companies to Transpower) is estimated based on information disclosed by line companies under the Electricity Information Disclosure Requirements 2004.

7. Figure 1 shows (in c/kWh) the total discount and/or distribution ("discount"), the transmission component of the line charge ("transmission"), and the remaining line charge received by the line company for the distribution of electricity ("adjusted distribution"). The line companies are ranked by the total line charge (adjusted distribution plus transmission plus discount) in descending order.

8. This calculation generates an "approximate" ranking of line company charges as information from different time periods has been used. Therefore, the results are at best indicative.

Figure 1: Approximate Ranking of Lines Company Charges after Deduction of Discounts and Distributions

Figure 1: Approximate Ranking of Lines Company Charges after Deduction of Discounts and Distributions


Table 1: Discount1 and Distribution Payments Made to Electricity Line Consumers in the 31 March 2007 Year
Line Company Discount (figures quoted include GST) Trust Distribution2 (not subject to GST)
c/kWh for 8000 kWh/year Comments c/kWh for 8000 kWh/year Comments
Alpine Energy - No discounts paid. 0.60 Alpine pays a dividend to the trust and the trust distributes money to consumers. In December 2006 the trust distributed $48 plus imputation credits to domestic load group consumers. No account has been taken of imputation credits.
Aurora Energy (formerly Dunedin Electricity) - No discounts paid. - No Trust. Council owned.
Buller Electricity - No discounts paid. - No trust distribution to consumers.
Centralines - No discounts paid - No trust distribution to consumers.
Counties Power 2.163 A minimum discount of $79 is given to consumers using more than 1,000 kWh in a year. 5,000-10,000 kWh consumers received $173 in December 2006. - No trust distribution to consumers.
Eastland Network - No discounts paid. - No trust distribution. The trust distributes money to the community in the form of grants.
Electra 2.78 In February 2007, a discount of $50 plus 25% of the customers total line charges for the year was paid. - No trust distribution to consumers.
Electricity Ashburton 0.864 A discount of 15.4% of the total line charge was paid on 31 March 2007. - No trust. This is a cooperative.
Electricity Invercargill - No discounts paid. - No trust. Council Owned.
Horizon Energy - No discounts paid. - No trust distribution to consumers. Horizon is publicly listed and dividends are currently issued to shareholders twice yearly. The Eastern Bay Energy Trust holds approximately 77% of the shares.
Kaiapoi - No discounts paid. - No trust distribution to consumers.
MainPower 2.143 This discount is credited to customer’s monthly account. Since 1 November 2005, an amount of 2.38 cents per kWh consumed is credited and subject to a prompt payment discount. - No trust distribution to consumers.
Marlborough Lines 2.00 A discount proportional to the total line change paid is given to all consumers. The average 8000 kWh/year domestic consumer (as defined by MED) received around $160. - No trust distribution to consumers.
Nelson Electricity - No discounts paid. - No trust. This company is fully owned by Marlborough Lines and Network Tasman.
Network Tasman 1.78 In August 2007, the average 8000 kWh consumer received a $142 distribution.  The cents/kWh charge is for the average 8000 kWh/year domestic consumer (as defined by MED) 1.25 $100 per consumer paid out by trust in November 2006.
Network Waitaki 1.1 The majority of customers received a discount of $159.70 in March 2007. - No trust distribution to consumers.
Northpower 1.5 Distributed in three bands in February 2007. Customers using less than 2000 kWh per annum received $50. For consumption levels between 2000 kWh and 15,000 kWh the customer received $120, and above 15,000 kWh the customer received $195. The discount represents a 2 month (approx) line holiday. 1.06 $85 per ICP in August 2005.
Orion - No discounts paid. - No trust. Owned by 3 Councils.
OtagoNet - No discounts paid. - No trust.
PowerCo - No discounts paid. - No trust.
Scanpower 3.75 Discount of $300 given in January 2007 to consumers who use 3000 kWh or more per annum. Note: Customers using less than 3000 kWh per year received $80.   No trust distribution to consumers.
The Lines Company - King Country 3.281 The average 8000 kWh consumer in the King Country retail area received a discount of $262.46. - No trust distribution to consumers.
The Lines Company - Waitomo 2.64 The average 8000 kWh consumer in Waitomo received a discount of $95.30. - No trust distribution to consumers.
The Power Company 1.35 Discounts given based on kVA bands. The average customer on a 20 kVA band received $108 (approximately 80% of consumers). - No trust distribution to consumers.
Top Energy - No discounts paid. 2.50 $200 per account less than 200,000 kWh/year. Payment made by cheque and sent out in December 2005.
Unison (formerly Hawke's Bay Network) - No discount paid. - No trust distribution to consumers.
UnitedNetworks - No discounts paid. - No trust. Owned by Vector.
Vector - No discounts paid. 4 $320 per connection was credited to power accounts for 2007. A portion of this discount relates to revenue from business activities other than electricity.
Waipa Networks 2.077 The average 8000 kWh consumer received a discount of $166.18. - The trust no longer makes distributions.
WEL Networks 2.877 Paid to all customers as at 31 March 2007 based on consumption in previous 12 months.  The calculation of the discount was 13 c/day + 2.835 c/kWh for uncontrolled load and 0.657 c/kWh for controlled load. - No trust distribution to consumers.
Westpower - No discounts paid. - No trust distribution to consumers.

Source: Figures based on enquiries of line companies and trusts.

1 Discounts are also referred to as Rebates.

2 No account has been taken of dividends and imputation credits in the calculations.



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