The recent Electricity Authority report on New Zealand’s power distribution companies gave Aurora a top score.

The companies that distribute electricity to Central Otago homes and businesses are Aurora Energy, which distributes to the majority of our region, and OtagoNet, which distributes to areas mainly in north-eastern Central Otago including St Bathans, Oturehua and Ranfurly.

Aurora Energy recently received a high ranking when the Electricity Authority released its pricing scorecards for Aotearoa New Zealand’s 29 electricity distribution businesses.

OtagoNet came in at tenth place, scoring well for strategy, but with a low score for efficiency and only a mid-range score for accord with pricing principles. The report states this year’s score for OtagoNet is similar to last year’s score.

In summarising this year’s review, the Electricity Authority noted Aurora Energy had demonstrated leading practice in a number of areas. The distributor was found to have significantly improved from last year, when it was rated relatively low.

Following public feedback last year, Aurora Energy reviewed its approach to regional cost allocation and has since developed a pricing strategy and roadmap for the future.

The company has stated it is holding public consultation with the goal to seek feedback on what has been developed. Aurora Energy states it aims to help customers understand more clearly how pricing works and ways people may be able to reduce their bills through behaviour change and personal choice.

Alec Findlater, General Manager Regulatory and Commercial at Aurora Energy, is leading this work across the Otago region.

Aurora Energy chief executive Dr Richard Fletcher said in a statement to media their view is that efficient pricing will be critical for a transition to a low carbon future that is affordable for their customers.

The government lens on distribution businesses has come about as a response to the system of monopolies in New Zealand.

Aurora and OtagoNet are the two distributors for Central Otago

Getting power to our homes and businesses is a complex matter. Electricity is first generated. It is then transmitted across the national grid, distributed down the power lines and sold to us.

Electricity transmission and distribution businesses are subject to specific regulation because they are natural monopolies. For this reason, Parliament decided transmission and distribution companies should be subject to regulation under Part 4 of the Commerce Act, because there is little or no competition in the market for these services.

The Commerce Commission therefore requires our transmission and distribution companies to publish information such as data on prices, measures of quality, financial information and forecasts of future expenditure, including planned investment into the network.

Earlier this year, The Central App reported the Commerce Commission had accepted Aurora Energy’s proposal for infrastructure investment. As a result of that decision, Aurora Energy stated it would not be readjusting annual lines charges for this year.

The 2021 Electricity Authority report states that pricing is a key area of focus when looking at distribution companies. Pricing affects how consumers use electricity, how distributors and others manage load, when distributors invest in new or replacement poles and wires, and the timing, level and location of investments in new technology by consumers and industry sector participants.

Reform towards efficient pricing, the Authority states, will drive efficient integration of PV (photovoltaic) systems, DER (Distributed Energy Resources, such as roof-top solar panels and units that utilise waste heat to provide cooling), EVs (electric vehicles) and the electrification of process heat – in the right place at the right time.

The report states Aurora’s self-assessment is notable because it highlights not just how its pricing currently aligns with the pricing principles, but also its target after its planned pricing reform.

To view the full report, click here.