A rip-off? (26 Jun, 2018)

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A rip-off? (26 Jun, 2018)

Postby aardvark_admin » Tue Jun 26, 2018 10:10 am

This column is archived at: https://aardvark.co.nz/daily/2018/0626.shtml

Seriously?

The power companies expect consumers to pay for the gear used to deliver power to their houses and then keep on paying for that gear as part of their monthly account?

Why can't power companies do what every other well-run business does -- and build the cost of expansion into their annual budget... BEFORE sucking out dividends for shareholders and bonuses for executives?

Is this fair? Should it even be legal?
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Re: A rip-off? (26 Jun, 2018)

Postby phill » Tue Jun 26, 2018 10:18 am

im wondering if the area they move the existing transformer to will also have to pay for it

where does that stop
they could just keep swapping transformers down the line every couple of years and charge everyone for the privilege
( ,,,,,,,, ....... A E I O U use em sparingly theres probably not enough )
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Re: A rip-off? (26 Jun, 2018)

Postby Malcolm » Tue Jun 26, 2018 10:45 am

I have no problem with Vector requiring a developer to pay for the upgrades required to support his development. You will find the council requires it as well to connect water/sewerage. He is going to profit handsomely from the sale of the townhouses. Why should his profit be subsidised by the existing consumers paying to provide services to his development? Ongoing maintenance will be covered by the lines company, it is this extension to the network which wouldn't have been planned/budgeted for he is being asked to contribute. I don't think the current funding model allows the lines companies to bill for expansions like this in their regular billing.
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Re: A rip-off? (26 Jun, 2018)

Postby aardvark_admin » Tue Jun 26, 2018 10:55 am

But Malcolm, if he's paying for the upgrade then he should also have ownership and be able to charge the power co for the use of *his* transformer (that he's paid for). The other houses that get hooked up to this transformer in future will get a free ride won't they?
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Re: A rip-off? (26 Jun, 2018)

Postby Malcolm » Tue Jun 26, 2018 11:05 am

He isn't paying for t he transformer or the lines, he is paying the cost of supplying grid connected service to his buildings. It just happens that this requires running lines and setting up a pole top transformer to do so. If he owned them he would also be responsible for sending a lines truck out there when a storm damages the lines, or for replacing the unit when it reaches its service life. It is all clearly spelled out in the rules which the lines companies operate under set by Transpower and a few other government oversight groups. If he did his due diligence before subdividing it would have all been spelt out to him before any work was done. The lines companies aren't allowed to bill extra to allow for Joe Bloggs to subdivide his section, they are required to bill Joe Bloggs for upgrades to service dramatically changed power requirements. It is the same as if a building in town suddenly started requiring 3-phase power when a single 60A circuit was sufficient before.
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Re: A rip-off? (26 Jun, 2018)

Postby JonL » Tue Jun 26, 2018 11:58 am

Here in Oz, (West), fully serviceable off grid for an average house is around $25-30,000. There are more and more people, espec. rural, taking this option.
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Re: A rip-off? (26 Jun, 2018)

Postby latewings » Tue Jun 26, 2018 1:20 pm

The charges do seem a little steep in comparison to other utility services that would also be required in a new development.

Watercare for example would charge circa $6500+GST for a large volume residential connection. There are backflow, and various other technical inspection charges, that seem to equate to around $10K for the scale of the project. I expect once inspections are complete that value will rise, but not to $50K. Source: [url=https://www.watercare.co.nz/CMSPages/GetAzureFile.aspx?path=~\watercarepublicweb\media\watercare-media-library\fees-charges\non_domestic_charges.pdf&hash=018ea5c71d0912f5e7f2e2a7f695bf2ec3827c86de6dbbf9a4fd162676aa0ee5](link)[/url]

I suspect the next Developer who builds in the same location will benefit from the expense this chap has to pay, purely because the capacity will already be there.
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Re: A rip-off? (26 Jun, 2018)

Postby phill » Tue Jun 26, 2018 2:08 pm

they also dont charge you for the new pumping station or any upgrade to it
and those have more problems being re-purposed than just a quick swap out and reused as is somewhere else
( ,,,,,,,, ....... A E I O U use em sparingly theres probably not enough )
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A rip-off by an electricity supplier? That can't be right!

Postby Perry » Tue Jun 26, 2018 2:22 pm

Drawing a comparison with off-grid should make one thing plain.

Without the transformer, there will be no business/sales of electricity by the electricity company, to the eventual residents in the development.

Therefore, the cost of the transformer is a cost of doing business to the power company.

Therefore the power company should pay for the transformer cost.
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Re: A rip-off by an electricity supplier? That can't be righ

Postby hagfish » Tue Jun 26, 2018 2:35 pm

Perry wrote:Drawing a comparison with off-grid should make one thing plain.

Without the transformer, there will be no business/sales of electricity by the electricity company, to the eventual residents in the development.

Therefore, the cost of the transformer is a cost of doing business to the power company.

Therefore the power company should pay for the transformer cost.

Precisely. Surely provision of electricity should be central to an electricity provider's business.
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