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25. 6. 97
SUPPLEMENTARY REPORT BY THE
CHAIRMAN OF THE STRATEGY AND RESOURCES COMMITTEE
22. SOUTH ISLAND POWER DIFFERENTIAL
The purpose of this report is to update the Council on recent meetings held with South Island MPs and South Island local authorities and interest groups on the above issue.
MEETING WITH SOUTH ISLAND MEMBERS OF PARLIAMENT
On Friday 20 June City Councillors and Regional Councillors met with a number of South Island Members of Parliament to brief them on the issue and the South Island's case for the retention of the differential.
Support was expressed by the MPs for the retention of the differential. In addition, several MPs unable to attend the meeting sent messages of support for the proposed representations to the Minister of Energy.
MEETING WITH SOUTH ISLAND LOCAL AUTHORITIES AND INTEREST GROUPS
On 24 June the Mayor chaired a well attended meeting of representatives of South Island local authorities and interest groups. The majority of South Island local authorities were represented at the meeting, together with the Canterbury Manufacturers Association, the Canterbury Employers Chamber of Commerce and the Canterbury Development Corporation.
The meeting commenced with a briefing by Councillor David Close on the background to the differential, the reasons advanced by ECNZ and Contact Energy for phasing it out and the arguments for its retention.
Following a wide-ranging discussion, it was unanimously agreed that, in addition to lobbying their local MPs and relevant Ministers of the Crown on this issue, South Island local authorities should make strong representations to the Minister of Energy seeking the retention of the differential.
The meeting was informed that the Canterbury Regional Council had an appointment with the Minister on 2 July and that Council's offer to expand the deputation to include representation from other parts of the South Island was accepted by the meeting.
Staff from this Council, Southpower and the Canterbury Regional Council will prepare a written submission in support of the retention of the differential on commercial and social grounds.
The meeting concluded with all present unanimously agreeing to issue a media statement detailing the reasons for maintaining the power differential.
Following the meeting the following media statement was issued:
"SOUTH ISLAND TO FIGHT TO MAINTAIN POWER DIFFERENTIAL
Communique from meeting of South Island local authorities, companies and power companies.
The Government is setting up the rules for an electricity market. These rules are unfair and lack any basis in sense.
The result is South Island consumers paying far higher electricity prices than the real cost of South Island power.
And the Government is now contemplating making this even more unfair by removing what little is left of the differential.
Electricity is generated far more cheaply in the South and the South Island's consumers should get at least some of that benefit.
South Island local bodies and business interests and power companies met today in Christchurch and expressed their unanimous opposition to present threats by ECNZ to remove the remaining differential.
There are a host of different reasons why this is so important besides the total absurdity of the rules the Government is writing.
It impacts hugely on South Island development. It will have a major impact on people's capacity to heat their homes. Loss of some jobs and industries is very likely.
We cannot allow the Government to act so irrationally.
South Island representatives will be raising these and other related issues with the Government as a matter of utmost urgency."
Recommendation: That the Council join with other South Island local authorities in making a submission to the Minister of Energy on this issue.
CONSIDERED THIS 25TH DAY OF JUNE 1997
MAYOR