Electricity line charges for the average residential bill will increase by $9.19 each month ($110.28 annually) for all of Aurora’s 22,000 Central Otago and Wanaka district customers from April 1.

The 8.5 per cent increase on last year’s line charges, by electricity distribution network provider Aurora Energy, is the largest of the increases being dished out to all its customers from Dunedin to Queenstown.

The average Dunedin residential customer will experience a $4.94 increase in the lines component of monthly bills while an extra $6.20 will be added to the average Queenstown residential line charges.

The average is calculated on a standard residential household consuming on average 9,000 units (kilowatt hours) a year. 

These increased charges, announced today (March 1) by Aurora CEO Richard Fletcher, are in line with the Commerce Commission’s draft decision on Aurora’s plans to invest in substantial improvements and upgrades to the reliability and safety of its network, including pole and sub-station upgrades in the Central Otago and Wanaka area.

The Commerce Commission’s draft decision permits Aurora to spend $523 million over five years and, of that sum, an investment programme worth $315.5 million will go towards power infrastructure upgrades begun in 2017.

Already, about one quarter of all poles have been reinforced or replaced, and the majority inspected. The work on poles, after years of underinvestment in the network, will steadily continue.

While Central Otago and Wanaka customers will still see a higher increase than Dunedin, it will be lower than forecast a few months ago, Richard said. Higher prices in Central Otago and Wanaka reflect the higher cost per customer of supplying power to parts of the network with fewer people, but many infrastructure assets.

Aurora will again re-assess its cost-recovery allocations for next year’s 2022 prices, and thorough public consultation on these changes will occur later in 2021, the company said.

Aurora’s annual report (2020) said the company continued to face a high level of external scrutiny from the Commerce Commission, the media, communities, councils and stakeholders.

“We accept that ongoing external scrutiny is an inevitable part of life at Aurora Energy until we fully address the impact of a prolonged period of historic underinvestment,” Richard said in his CEO’s report. 

Getting the right balance between costs and the urgent need to improve the condition of network assets is very challenging, he said. 

“Customers have told us very clearly they want essential work to be done, but that significant price increases are a real concern,” Richard said. “Our investment focus over the next three years is on what we believe is necessary to keep the network safe and to deliver electricity to customers when they need it.”

In 2020, Aurora spent $73.8 million on maintenance and improvements to its network which supplies power from the national grid to over 91,500 homes, farms and businesses in Otago and the southern lakes. This year it plans to spend a similar amount. 

Aurora Energy Limited, a subsidiary company of Dunedin City Holdings Limited owned by Dunedin City Council, has total assets worth $617.6M.

Further information from Aurora Energy’s annual report (2020) is available here.