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Time for a wakeup call to the electricity industry

5 Feb 2024

How many times have I written a column about the sorry state of New Zealand's electricity industry?

How often have I warned that those in charge are very much asleep at the wheel and seem ill-prepared for the massive surge in demand as EVs replace ICE vehicles?

Why is it that even before the effects of growing EV use are felt, we get warnings about the potential for power shortages in winter?

Well guess what?

It's mid-summer and those warnings are being rolled out again.

According to an RNZ report Rolling power cuts may hit this winter.

So that's situation-normal then.

From the story:

"Transpower's Winter Outlook has highlighted the risks to keeping the lights on if winter is severe because of pressures on ensuring sufficient generation, maintaining the lines network, and managing increasing demand"

What the hell is going on here?

Why is so much of our power industry's profit being paid to the government as a dividend instead of being used to fund the maintenance and expansion of our electricity infrastructure?

It strikes me that we have a very basic problem that seems to be affecting almost all government services but which nobody seems willing or capable of addressing.

Look at the state of the nation's roading network as another example of this ridiculous lack of effective maintenance.

I seem to recall that 40 years ago you could drive from Taupo to Auckland without encountering a single area of road works -- because the roads were maintained properly. Estimating the length of a journey was simple because there was very little chance you'd spend half an hour crawling through an endless series of 20Kph areas which were constrained to a single lane by the presence of roadworks crews.

There are bits of road around here that seem to be "repaired" every year -- why can't they just do the job properly and have it last, like it used to?

Well I've written columns about that before and I believe it's down to the use of "safer" surfacing materials and application systems. These "safer" systems just do not work at all well and we pay the price in having to constantly re-repair areas where they have been used.

However, the problem, whatever the cause, speaks to a "just patch it to the minimum standard" penny-pinching approach to caring for our most valuable state-owned assets. The same goes for the power networks I'm afraid.

Naturally, no government wants to jeopardise its chances of re-election by hiking taxes so instead they use the devious method of stealth-tax. This is what happens when the government owns the lion's share of the electricity industry. They simply suck the money that should be used for maintenance and expansion into their coffers so as to keep direct taxation to a "re-electable" level.

The problem with this strategy is, as we're now seeing, that deferred maintenance and reinvestment eventually comes back and bites you on the arse. At some stage we find ourselves facing blackouts in mid-winter, when we most need a dependable and reliable electricity supply.

And this, remember, is before we start factoring in the strong growth of EVs, which are now so popular that they're about to be hit with road-user charges as of April 1.

When will someone in a position of authority and control wake up to what's going on here?

As a consumer, I know what's coming next though...

Power prices will soon be hiked, quite considerably, as we're told that this is necessary to fund the required "modernisation", extra generation and distribution capacity needed for the era of the EV. Ah, the joys of a market where one player (government) has majority shares in all the companies -- they can do whatever the hell they want because there is no effective competition.

If ever there has a time to consider going "off grid", now is it. Don't rely on cloth-headed politicians to do the right thing for the nation... they're far more focused on being re-elected and what's best for themselves.

How long, I wonder, before we see a tax on privately owned solar panels and wind-generators so as to fund the expansion of public energy infrastructure?

Carpe Diem folks!

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