Electricity Delivery Price Increase

23 February 2004

"From April 2004, electricity retailers will pay approximately 3.9% more for the delivery of energy, predominantly due to the increase in Transpower's prices" said Orion Chief Executive Officer, Roger Sutton. Of this increase, 2.8% relates to Transpower and costs associated with the new Electricity Commission.

Transpower is a state-owned company that owns and operates the national transmission grid and delivers electricity to Orion's network. Transpower has announced a 13% increase in its prices.

"It is impossible to say how this increase will affect individual households as retailers repackage our charges, and have other costs to consider at the same time, but if retailers pass this on the increase translates to about a 1.5% retail price increase, or 35 cents per week for an average domestic consumer."

Orion expects that the increase will comply with the Commerce Commission's price threshold. Orion's own average line prices have reduced in real terms by around 10 percent over the last 5 years, despite inflationary cost pressures.

End

Notes for editors

Orion New Zealand owns and operates the electricity distribution network in Central Canterbury (including Christchurch) between the Waimakariri and Rakaia rivers and transports electricity to more than 170,000 homes and businesses in this area. Orion charges electricity retailers on a wholesale basis for this service, and retailers then on-charge homes and businesses.

For more information:

Roger Sutton
Chief Executive Officer
(03) 363 9846 or (0274) 333 632

Orion bases its statements around "average domestic consumers" on information maintained by the Ministry of Economic Development. Please refer to http://www.med.govt.nz for details.