Ministerial Inquiry into the Electricity Industry - 3 February 2000
[ Last Updated 15 February 2006 ]
Media Statement from Hon Pete Hodgson, Minister of Energy
3 February 2000
The Minister of Energy, Hon Pete Hodgson, announced today the terms of reference and membership of a three-person Ministerial Inquiry into the electricity industry.
"This Inquiry will consider what changes are needed to ensure New Zealanders have the best possible electricity system," Mr Hodgson said.
"Many New Zealanders remain unconvinced that the restructuring undertaken by the previous Government has benefited or will benefit the ordinary consumer. This Government shares that concern.
"Our overall objective with this Inquiry is to ensure that electricity is delivered in an efficient, reliable and environmentally sustainable manner to all consumers. New Zealanders need to be sure that they will get fair value for their money. At present they have no such assurance.
"The Inquiry process will be open. I urge electricity consumers and the industry to make good use of the opportunity it represents by making their views known.
"It is unfortunate that the Government is forced to this effort and expense to address a problem created by the previous administration. The instability and uncertainty created by National's hasty and ill-conceived changes were both predictable and predicted.
"We must, however, deal with the electricity sector we have inherited, rather than the one we would like. Some of the recent changes are now irreversible, but changes are possible in many other areas to ensure good outcomes for consumers.
"In considering electricity policy, we will listen carefully to both consumers and the industry. Our approach is to use industry solutions where possible, and regulatory solutions where necessary."
The Inquiry will focus on distribution and retailing, the wholesale market and the transmission grid. Its report is due by June 12.
The Inquiry will be headed by Hon David Caygill, a partner in the law firm Buddle Findlay and a former Government Minister. Mr Caygill has extensive experience in public and commercial law and in the electricity industry, where he chairs an industry committee establishing rules for transmission grid security.
The two other Inquiry members are:
- Dr Susan Wakefield (formerly Lojkine), who was Chairman of the Commerce Commission from 1989-94. Dr Wakefield is an accountant by profession with extensive business experience, including directorships, and a thorough knowledge of competition issues.
- Mr Stephen Kelly, Managing Director of the Australian National Electricity Code Administrator (NECA). NECA is responsible for encouraging and fostering the development of the Australian national electricity market, and for administering and enforcing the market rules. Mr Kelly has extensive experience in electricity industry regulation from his previous employment with the Premier’s Department in New South Wales and the UK Treasury.
Mr Caygill and Dr Wakefield have involvements and interests in companies operating in the energy sector. Appropriate arrangements for handling these conflicts have been put in place and full details are set out in the attached material.
"I am fortunate to have secured the services of these three experienced panel members," Mr Hodgson said. "I am confident they will make a very significant contribution to assist us in getting the electricity industry back on track."
The panel will be assisted by Professor Stephen Littlechild, the former United Kingdom regulator for electricity, acting as an expert adviser. Mr Hodgson said Professor Littlechild was one of the world's foremost authorities on electricity pricing issues and the Government was very pleased to have secured his services.
Further details about the Inquiry will be placed on a special website available from next week. The website address is www.electricityinquiry.govt.nz. Interested parties will be invited to make submissions to the Inquiry and public hearings will be held.
"Establishing this inquiry was always set to be my first task as Minister of Energy," Mr Hodgson said. "From today my attentions will turn to the second task, which is to begin improving New Zealand’s energy efficiency."
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