Media StatementsNews Release
27 July 2009
Electricity Ashburton reports record surplusA record profit will be revealed to shareholders of Electricity Ashburton this week when they receive the company’s annual report for the 2008/09 financial year. Before discounts and taxation Electricity Ashburton recorded a $13 million operating surplus for the year to 31 March 2009, said company chairman John Tavendale. “This compares to an equivalent figure of $7.3 million for the 2007/08 financial year, and is a marked increase on the previous record of $8.3 million achieved in the 2005/06 year. “Increased revenue from lines services and savings in transmission costs drove our increased profitability. “New network connections generated a $2.25 million increase in revenue from lines services and the company benefited when Transpower altered its methods of charging, reducing Electricity Ashburton’s charges by $3.1 million in the process,” he said. John Tavendale said the company also took important steps in two infrastructure projects. “The Barrhill Chertsey Irrigation scheme has the potential to further improve the economic well-being of the region. Reaching agreement to construct the primary canal and associated generation stations for the proposed scheme was a critical milestone. “Plans are also taking shape for Electricity Ashburton’s community-owned network of ducted fibre optic cabling, able to bring high speed broadband services to every residence and business in the Ashburton district,” he said. According to John Tavendale, adding 473 new connections to the network during the 2008/09 year boosted revenue from lines services by 8.8 per cent. “Maximum demand levels placed on the network consequently grew to 135MW, compared to 122MW in 2008 and 104MW in 2007. “That amounts to a ten per cent increase in the past year and a rise of almost 30 per cent over two years. “Such a prolonged period of growth is exceptional, both nationally and internationally. In spite of that growth however, Ministry of Economic Development figures show line charges in Ashburton are the fourth lowest in the country. “While the charging changes made by national grid operator Transpower were also beneficial, prices notified by Transpower for the current year are set to cut this saving by 50 per cent,” he said. On a less positive note, John Tavendale said legislation enacted last year was not as favourable as the company had expected. “The Commerce Amendment Act provides consumer-owned companies concessions in complying with the regulatory requirements of the Commerce Commission. “We had assumed that our customer owned co-operative structure would have counted in our favour, but unfortunately, because of our governance structure, the Commerce Commission saw it differently. As a consequence, from 1 April 2010 Electricity Ashburton must meet the regulatory requirements of the Commerce Commission and follow a yet to be determined default price path,” he said. Electricity Ashburton is a customer owned co-operative company, with shares held by all the approximately 12,500 businesses, residents and organisations connected to its power lines network. Ashburton District Council holds deferred shares in the company, which do not entitle the Council to any dividends or voting rights. Since the co-operative was founded in 1995, the company has returned more than $40 million to shareholders through dividends, rebates and deferred discounts. Copies of Electricity Ashburton’s annual report will be distributed to all the company’s customer-shareholders this week. The company’s AGM will be held on 9 September. Further information:
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