Final decision due
In June 2020, Aurora Energy (Aurora) applied to the Commission for a customised price-quality path (CPP) so it can spend $383 million over the next 3 years (or $609 million over five years) to address safety and reliability issues on its network.
Aurora’s application is significant and is approximately double the allowances we set Aurora for the previous comparable periods.
Aurora says its investment plan is required to address historic under-investment in its network which has resulted in a gradual deterioration of its equipment including lines, poles and transformers. In recent years this has resulted in a higher number of safety incidents and an increasing number of unplanned power cuts.
To pay for this, Aurora had forecast significant increases to power bills. You can read Aurora’s final proposal here.
We understand that now, more than ever, household incomes will be strained, especially in light of COVID-19. Many consumers will be struggling to pay their bills while needing a reliable electricity supply.
Our role in Aurora’s investment plan is to set network reliability standards and determine how much money it should be allowed to recover from its customers to carry out its plan and over what period. On 12 November 2020 we published our draft decision on Aurora’s CPP and some supporting measures we are planning that would require it to provide greater transparency on the delivery of its plan. Overall, we consider Aurora has made its case for a step up in investment in its network. Without a CPP, its network would continue to deteriorate, safety incidents would increase, and its customers would experience more, longer, outages.
As a result of our assessment we are proposing to allow Aurora to recover $86m less from its customers than it had asked for on a five-year CPP. This reduction is because we consider some of its expenditure could be deferred to a later date and some was not sufficiently justified to the level Aurora had sought. Even so, Aurora would be able to significantly increase its expenditure to address the issues on its network and recover the cost from its customers.
In our draft decision, we also propose to amend Aurora’s quality standards for unplanned outages to better reflect the state of its network. This would not be set at the levels Aurora requested but would allow it to meet targets that reflect its performance over the past five years. Overall, this should see the reliability of supply stabilise at current levels before gradually improving over time.
A summary of our draft decision, consumer fact sheets, the full reasons paper and a template submission form to provide us with your feedback are all available below by clicking on the ‘Documents’ tab.
You can fill in our online consumer submission form hereMake a consumer submission
The Commission is due to release its draft decision on 12 November 2020.
This will be followed by a series of public meetings in the following locations:
|Alexandra||23 November||Alexandra Community Centre, 15 Skird Street||4-6pm|
|Cromwell||24 November||Cromwell & Districts Presbyterian Church, The Auditorium, 10 Elspeth Street||4-6pm|
|Wanaka||25 November||Lake Wanaka Centre, The Auditorium, 89 Ardmore Street||10am-Midday|
|Queenstown||25 November||Queenstown Events Centre, the Mezzanine Function Room, 33 Joe O'Connell Drive, Frankton||4-6pm|
|Dunedin||1 December||The Dunedin Centre, Conference Room 2, 1 Harrop Street||4-6pm|
Hard copies of the consultation paper and submission forms will be available for you to take away and Commission staff will be on hand to answer any questions you have.
Aurora Energy owns and operates the poles, lines and other equipment that distribute electricity from Transpower’s national grid to 90,000 homes, farms and businesses in Dunedin, Central Otago and Queenstown Lakes. Aurora is a wholly owned subsidiary of Dunedin City Holdings Limited, owned by Dunedin City Council. Aurora’s charges are built into power bills and are something its consumers are required to pay no matter which power company they are with. Typically, electricity distribution charges make up about a quarter of an average residential consumer’s power bill.
We are seeking specific feedback from consumers throughout our assessment process.
However, if you want to get in contact with us or be added to our mailing list for updates on this project please email us at firstname.lastname@example.org
A timeline of key steps in our assessment process are outlined below.
This view shows the latest stage in the project. Click on the circled dates to see details. Navigate to other months, or scroll down, to see all stages.
Note: these dates are indicative only and are subject to change.