Bradford Says Electricity Reforms Working Well

The Minister for Enterprise and Commerce Max Bradford says the Government's electricity reforms are working well. "The Government can't be held responsible for the lack of rainfall," Mr Bradford said in response to forecasts by electricity companies of price increases.

"The dry conditions in the South Island and the Huntly power station fire have pushed wholesale prices up recently. Such things can always happen, but the Government reforms ensure that domestic consumers are much better protected against dominant market behaviour by electricity companies than previously," Mr Bradford said.

"Without the electricity reforms prices would have inevitably been pushed up even higher given the current unavoidable circumstances." Mr Bradford said he was confident that when the reforms fully kick in on 1 April there would be another round of competition between electricity companies as happened last year which led to significant price drops for consumers.

He also said that line companies tempted to increase their prices unreasonably should reflect carefully on the regulatory controls also coming in to place from 1 April, which could lead to price controls.

"Since the reforms were announced last year prices have already fallen for many thousands of consumers. Wholesale prices are also more flexible so generators and retailers have incentives to manage supply wisely at the lowest cost to consumers," Mr Bradford said.