The case for energy loans: read our latest explainer
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Talk about going in one door and out the other.More people than ever are struggling to pay their energy bills. There is a system designed to help those in that situation and a total of $562 million was paid in the last financial year through the Winter Energy Payment. There are additional emergency payments on top of this. And this completely ignores the wider health and social costs of 'energy poverty.' Interestingly, a similar amount - $482 million - was paid to the Government in dividends from its shares in the gentailers Meridian, Mercury and Genesis in the last financial year.
Many of us feel good about our ownership of the gentailers and what they provide back to the Government. We're in favour of a more circular economy and electrification offers a great opportunity to embrace that, but this is the kind of circular economy that doesn’t make any sense.
It is a band-aid solution and it is not addressing the root cause of the problem.
According to Statistics NZ, since December 2021, electricity prices have risen by 27 percent. Other estimates suggest prices will increase by around 30% before the end of the decade. And the latest from the Electricity Authority shows 40%, yes 40%, of households are worried they won't be able to pay their power bills in the next year.
If the Government is serious about reducing bills, it should instead be investing some of that money into solar in homes - and particularly low-income homes.
Even just $6-7 million would allow nearly every home to access long-term low interest finance through the Ratepayer Assistance Scheme. Homes with solar could save around $1,000 per year, including loan repayments. And homes with the full suite of electric kit could save around $2,000 per year.
The Government would get its money back and breaking the link with the big energy landlords that keep ratcheting up prices would be much more effective at lowering energy bills than the usual tactic of applying ‘downward pressure’. That hasn’t worked.
The current system is not a good example of ‘smart economic management’, and neither is the similarly circular decision to cancel the $1 billion GIDI fund, which was designed to get gas users onto electricity, and spend “north of $1 billion” to build a new LNG terminal that will keep them hooked on gas and do very little to lower bills.
Real savings begin at home.
Everyone is rocking on down to Electric Avenue today (this one online, not that other small one in Hagley Park in Christchurch), so let's ride the lightning: profits and electricity prices keep going up, as panels keep going down; a new paper puts a number on how much more homes with solar sell for; we're bottling things up with big and small batteries and they are eating into gas in Australia and California; transport emissions drop across the Tasman as a result of Government EV incentives, while HEB Construction electrifies its fleet; electrons are coming from above in China; and Xpeng announces the arrival of a crazy looking electric van/aircraft carrier.
Read moreDownloadWarren G and Nate Dogg said it best when they said: 'Regulators, mount up!' - and this week, they have.In a rare joint open letter, three different regulators - EECA (Energy Efficiency and Conservation Authority), the Commerce Commission and the Electricity Authority - have basically told the lines companies to pull their socks up and make the most of ‘non-network solutions’ (AKA stop building more expensive poles and wires and start looking at customers and new technology as part of the solution!).
Read moreDownload"The LNG announcement from earlier this month has set the stage: electricity, and the energy sector more broadly, is set to be a major election issue this year. Casey has compared electricity to telecommunications, an area where services have become much cheaper in the last decade with technology advancing. “There are supply challenges for the grid and natural gas, and increasing pressure to find sustainable alternatives as reliance on fossil fuels becomes less viable,” he wrote in a Newsroom piece earlier this month, heralding the “electric election”.
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