Whanganui consultation

We review the performance of our network closely to inform our planning. 

Our recent $20 million investment programme in Whanganui and surrounding area has enhanced our network and has given us more time to consider how best to address the long-term security of supply challenges. 

The continued expansion of the area, with more people choosing to live and work in Whanganui, and our electricity consumption forecasts, mean that we now have the certainty to make significant further investments now to increase our network capacity to meet the rising demand for power.

As industries look to decarbonise their operations, we’re forecasting a much greater reliance on electricity over the coming years and therefore need to address this risk so that we can continue to supply customers with secure power and allow for future growth.

As a regulated business, our revenues are set by The Commerce Commission, which ensures the costs passed to our customers are fair and reasonable.

We’re committed to delivering safe and reliable electricity to our customers by investing in the electricity network. We do this by continually investing in building and maintaining the poles, wires, transformers, and other assets that ensure your electricity supply meets your needs – both now and in the future. We update our prices once a year (with effect from 1 April) to reflect the costs of operating and investing in the network. From 1 April 2023, our electricity prices have changed – more information is available here. 

As a regulated electricity distribution company, we don’t operate in this environment. Government agencies such as the Ministry for Business, Innovation and Employment (MBIE) play a central role in shaping and delivering these plans, along with other third-party organisations.

Where traditional network solutions such as power poles and lines are not feasible on our network for reasons such as the cost to our customers, we partner with organisations that can help to maintain the reliability of our network, typically during the times our electricity load peaks. An example of this is our recent partnership with SolarZero to offer distributed battery network support to the northern part of the Coromandel.

We haven’t yet determined the best option to improve the security of supply in Whanganui but will be considering factors such as reliability, cost and how to minimise the impact on the environment. 

Across our network, our approach is to deliver network solutions that meet the needs of our customers and are cost effective. This is particularly important because we’re a regulated business, meaning the cost of maintaining and enhancing the performance of our network is set by the Commerce Commission, and is passed back to customers as part of your power bill, issued by your retailer.

Installing new power lines, particularly those underground is a costly option and is considered in terms of the population numbers per kilometre to ensure its economically viable.

Overhead lines also offer the flexibility to connect new customers more easily and provide greater accessibility to make repairs and fix faults, often without turning off the power. You can watch this video for more information.

We have a contractual arrangement with retailers on our network that means they communicate directly with customers via email, text and/or written notifications.

We work closely with our retailers to notify our customers about any planned and, where possible, unplanned outages on our network. 

We’ve been exploring ways to keep customers up to date about activities on our network, and are focused on communicating these via our website.

This includes our new outage map, which provides more detailed information about the status of an outage, down to a single property, and the ability to search your address for any future planned outages that may affect your area.

At Powerco, we play an important role in the electricity industry as a distributor that brings power to homes and businesses (via the National Grid) across the North Island.

Under our regulatory settings as an electricity distribution company, we are not able to generate electricity. The generation of electricity is a commercial decision that is guided by market conditions and their feasibility (including renewable sources such as wind and solar power). 

While we don’t generate electricity, we connect sources of generation to our networks to distribute to our customers. 

We’re an experienced asset manager and infrastructure owner that works closely with those in our sector to help drive outcomes that will create a sustainable future and deliver the best outcomes for our customers.

Yes – if we get support from our customers, the extra cost of implementing these improvements will be paid annually and spread over a 30-year period as part of our annual pricing structure (with effect from 1 April 2024). Managing our pricing structure in this way enables us to keep the additional cost to our customers as low as possible.

We’re regulated by the Commerce Commission, New Zealand’s primary competition, fair trading, consumer credit and economic regulatory agency – essentially, it holds companies like us, who operate under their framework, to account. If our upgrade in Whanganui goes ahead, the Commerce Commission will ensure we deliver what we promise to our customers.

A critical part of the Commerce Commission’s role is to ensure that consumers are well informed and protected by regulatory obligations and standards. At Powerco, we work closed with the Commerce Commission under our regulatory framework and our shareholders, which includes regular and transparent reporting across our operations. You can find out more about the benefits our investment programmes are delivering to our communities here.  

Trees cause around a quarter of all power cuts on our electricity network each year, which is why we run a proactive vegetation management programme to achieve the best balance of network reliability and cost-effectiveness. In areas where our most critical assets are, we carry out annual inspections to trim or remove vegetation.

In recent years, we’ve introduced new, more efficient ways to remove vegetation from around our overhead lines and other electricity assets. This includes eco-mulching and using LiDAR technology to identify any vegetation encroaching on our network from the sky, so that we can trim or remove trees before they cause an outage. 

Between 1 April 2021 – 31 March 2022, we worked with our vegetation contractors to clear trees from 16,166 sites across our network – exceeding our plan to manage 9,263 tree sites by 75%.

We also monitor trees growing close to our network lines and notify property owners (who are legally required to keep trees a minimum safe distance from power lines) about any trees that are too close so that it can be trimmed by an approved contractor.  

While removing trees is necessary for keeping our network safe and reliable for our customers, we support planting native trees in areas away from our powerlines through partnerships such as Replant for Tomorrow.

In 2020, we saw a 23% increase in the use of EVs on our network across the North Island and we expect to see a continued rise as New Zealand works towards its net-zero emission goals.

To help us plan for the impact this growth will have on our electricity network, we launched a Smart EV Charing Project, which collects data between 2021–2023 about how drivers charge their vehicles at home. With 80 participants across our network footprint, we’ll use the insights to better understand charging habits and how this can help us to manage the times that load peaks on our network to create a more sustainable future and prepare our networks.

In Whanganui specifically, like in other areas of our network, we are preparing for the growing demand for electricity, as our population grows, and our commercial and industrial companies decarbonise their operations. The uptake of EVs is one of the factors that contributes to the rising demand for power, which is why we need to improve the security of our network in Whanganui to ensure a reliable supply of power now and into the future.

Powerco’s electricity distribution charges make up around 27% of your overall electricity bill. The other 62% of your bill is made up of all non-Powerco charges including generation costs, your retailer’s charges and GST.

Your retailer, the company who sends your power bill, is best placed to speak to about any questions or concerns relating to daily charges and plans. 

Regarding Powerco’s electricity distribution charges, as a regulated business, the cost of maintaining and enhancing the performance of our network is set by the Commerce Commission to ensure our prices are fair and reasonable for our customers. We also pass on Transpower’s charges for the national transmission network (also known as the National Grid). These make up about 11% of your electricity bill.

The overall impact of our pricing changes on your electricity bill will depend on a few things, such as how and when you use electricity and how your retailer chooses to structure the prices they charge you. We review our prices every year to ensure we can continue to meet electricity demand as the communities we serve continue to grow, and the way our customers use electricity changes – click here for more information.

Our regulatory structure sets our operating environment, which means that electricity distribution companies such as Powerco recover the costs to build and maintain networks through their customers’ power bills. 

In New Zealand, there is no funding or specific budget available from the Government that we can apply for to pay for building or maintaining electricity infrastructure.

Yes – we are committed to identifying the best solution that will improve the security of our customers in Whanganui and the surrounding area, located in urban and rural locations.  

Our investment in the region aims to strengthen the overall security of the network, including options to back-feed power if a significant asset is damaged.

Localised unplanned outages caused by weather conditions and other factors outside of our control, such as vehicles colliding with power poles, are unavoidable. When these outages occur, we work as quickly and safely as possible to get your power back on.

Our investment programme to upgrade our network reliability in Whanganui and the surrounding areas is ongoing.

The area’s continued expansion and rising demand for power means that we need to increase our capacity. Making upgrades to the connection point between where we get electricity and our distribution network, will improve the security of our supply to customers in the area. 

Doing this work now means we can address the increasing risk of unplanned outages on our network and enable the area’s future growth. There are a number of options, which will be determined by how much we invest in the network, the cost of which is passed back to our customers through their electricity bill.

Our investment programme to date has delivered enhancements to our network and given us more time to consider how to address the long-term security of supply challenges. The impact of delaying our action or not investing in strengthening the supply between the national grid (where power comes from) and our distribution network (that brings power to you) will mean that the risk of unplanned outages over extended periods of time for our customers in Whanganui, will increase. 

With demand for power already high, added to our forecasts for increased electricity consumption in the coming years, our network will reach capacity to supply customers and will constrain the future growth of the area.

If we get support from customers in the Whanganui area and are able to invest to improve the network now and increase capacity for future growth, it will significantly improve the security and reliability of the main supply point to your community. Localised unplanned outages caused by weather conditions and other factors outside of our control such as vehicles colliding with power poles and damage to our equipment are unavoidable. When these outages occur, we work as quickly and safely as possible to get your power back on.

As a regulated business, the cost of maintaining and enhancing the performance of our network is set by the Commerce Commission. These costs are passed back to you as part of your power bill issued by your retailer. 

That’s why it’s important to us that we get your feedback, particularly with regards to how much you are comfortable paying to improve the security of your supply.

Price increases are passed back to customers via their monthly power bill as opposed to a lump sum. There are a number of options available to improve the security of your supply depending on how much our customers are willing to pay annually to address the increasing risk of unplanned outages – that’s why we want your input.  

Once we understand how much can be invested as part of our customer’s feedback on how much they would be willing to spend to improve the security of the community’s power supply, we can calculate pricing. Depending on feedback from customers and how soon we can implement our improvements, pricing increases would take effect from 1 April 2024.

If we get support from customers in the Whanganui area and are able to invest to improve the network now and increase capacity for future growth, we will spread the cost over a period of 30 years. Managing our pricing structure in this way enables us to keep the additional cost to our customers as low as possible.

We’ve considered alternatives as part of our decision-making process and are unable to identify a practical and economic alternative to traditional network options. We are now exploring network options that will address the risk, offer minimal visual and environmental impact, and can be delivered in the appropriate time and within the cost range our customers are comfortable paying.

Yes, we’re committed to minimising any impacts to the environment where possible in our selection of the best solution to address the security of the network, in line with how much our customers are comfortable paying.