NEWS RELEASE 11 December 2013 NZX: MRP
ASX: MYT
Mighty River Power commits to no energy price increase in 2014 Mighty River Power has today announced a commitment to no increase in headline energy prices for the Company’s residential electricity and gas customers until at least 1 April 2015. Chief Executive, Doug Heffernan, says the Company will be holding customers’ energy prices – which make up typically 50-60% of household electricity bills – at the same level as set in April 2013. Dr Heffernan says at the time of the Company’s IPO the Company forecast no increase in effective retail prices in 2014. This has now been confirmed in Mighty River Power’s energy pricing schedule for the Company’s brands including Mercury Energy, ahead of the announcement of charges from local lines companies and Transpower, expected to be set in the next two months. “We are now confirming that for our customers there will be no increase in our energy prices for a further 15 months. However there will likely be changes in customer pricing from 1 April due to variables over which we have no control that we pass through on our bills – such as transmission and distribution charges and any increases in metering costs due to regulatory requirements.” He says the impact on customers’ bills of these charges, which are mostly regulated by the Commerce Commission, will be announced as soon as they are known and confirmed by the relevant companies. Dr Heffernan says the ‘no energy price increase’ commitment reflected the fact that New Zealand has one of the most competitive electricity markets in the world, as highlighted by PWC’s Leading Energy report released last month. “Our decision to hold energy prices is the result of a healthy, well-functioning electricity market that has, by global measures, delivered positive outcomes for both customers and the country, enabled by the multi-billion dollar investment in renewable generation capacity by a number of competing generators over the last few years. “Retail electricity prices in New Zealand are very much middle of the pack of developed countries, and consistent with average income levels. Putting this in local terms, the latest Statistics NZ economic survey shows spending on electricity is a relatively stable component of household budgets, making up about 3.6% of total net household expenditure in the year to 30 June 2013 – down from 3.7% in 2010." ENDS.
For further information: David Glendining Head of Communications T 0272 105 337
Anna Hirst Head of Investor Relations T 0275 173 470
Mighty River Power is one of New Zealand’s largest electricity companies – with its core business based on reliable, low fuel-cost electricity generation complemented by sales to homes and businesses. The Company generates about 17% of New Zealand’s electricity. It operates the nine hydro stations on the Waikato River, five geothermal power stations in the Central North Island and a multi-unit gas-fired station in Auckland. More than 90% of its annual electricity production is from renewable sources. Mighty River Power sells electricity to end customers through multiple channels and retail brands, including Mercury Energy, GLO-BUG, Bosco Connect and Tiny Mighty Power. Mighty River Power’s metering business, Metrix, is one of New Zealand’s largest providers, supplying electricity retailers with enhanced information solutions for their residential and commercial customers. Mighty River Power is one of the world’s largest geothermal power station owners, and has a successful track record in geothermal development, investing more than $1.4 billion in geothermal development since FY2006. The Company is applying this capability and experience – gained through domestic geothermal exploration, development, construction and operations – to invest in international growth opportunities.