The Commerce Commission's decision to grant Colwall Property Investment Limited a conditional exemption from the Electricity Industry Reform Act (EIR Act) reinforces the important precedent set by the Commission's Trans Tasman Properties Limited (TTPL) decision.

Commissioner Dr Kate Brown said that the decisions increase tenants' ability to choose electricity suppliers, and other property companies should look carefully at how the decisions might apply to them.

The decisions allow tenants to choose to buy electricity from their landlords or to shop around for better deals from other suppliers.

The Commission granted Colwall an exemption subject to conditions that Colwall:

  • does not introduce electricity lines charges to tenants of WestpacTrust Tower and Atrium on Elliott Shopping Centre;
  • does not prevent access, on reasonable terms and on a timely basis, to any embedded electrical wiring systems by any electricity supplier to tenants of WestpacTrust Tower and Atrium on Elliott Shopping Centre;
  • provides all tenants of WestpacTrust Tower and Atrium on Elliott Shopping Centre with relevant electricity consumption and billing information; and
  • notifies the Commission if it changes, or enters any new, electricity contracts with tenants of WestpacTrust Tower and Atrium on Elliott Shopping Centre.

The EIR Act was passed last year and came into effect on April 1 this year.

One of its requirements is that organisations must separate their electricity lines businesses from their electricity supply businesses that supply at least 2.5GWh a year. The Commission considers that the definitions in the EIR Act include wiring in buildings as a lines business and selling electricity to tenants as a supply business.

Parties can apply to the Commission for exemptions from the EIR Act. In considering an exemption, the Commission must answer three questions:

  1. Would the exemption inhibit competition?
  2. Would the exemption allow cross-subsidisation between electricity generation and lines businesses?
  3. Would the exemption create a relationship between electricity lines and supply businesses, which is not at arms length?

If the answer to any of these questions is "yes" the Commission must not grant an exemption.

Media contact: Commerce Act Manager Geoff Thorn

Phone work (04) 498 0958

Communications Officer Vincent Cholewa

Phone work (04) 498 0920

Commission media releases can be viewed on its web site www.comcom.govt.nz