Power companies in customer swap

By Phil Boeyen, ShareChat Business News Editor

Monday 4th February 2002

Tauranga-based electricity retailer TrustPower (NZSE: TPW) has agreed to trade some clients with First Electric, the retail arm of state-owned Mighty River Power.

TrustPower says it has agreed to swap around 21,000 of its customers in Northland, Auckland and Thames Valley for 20,000 First Electric customers in Wellington and Christchurch. The figure represents around 8% of TrustPower's client base.

Chairman, Harold Titter, claims the move will benefit both the electricity retailers and consumers.

"These transfers will result in greater economies of scale in the respective markets and a closer alignment of customer bases and generation facilities. This will enable both companies to provide higher levels of service and be more competitive."

Mr Titter says the transaction was completed without monetary settlement but TrustPower is expecting to realise a capital gain on the customer exchange. The transfers are due to take place in March.

The latest move is another signal that the electricity reforms introduced into New Zealand some years ago are taking a long time to settle down.

Although the reforms were designed to allow more competition and choice for consumers, the past year has seen considerable transfer of clients, particularly after Natural Gas Corp (NZSE: NCH) pulled out of retailing last year and sold thousands of customers to Genesis and Meridian.

Comments from our readers

No comments yet