Trustpower wants to keep power on for financially stressed Kiwis

Wednesday, 27 May 2020

The country's fifth biggest power company, Trustpower, says it's in talks with other electricity firms about how to handle a growing number of customers who can't pay their bills.

Trustpower said it will work with customers on payment arrangements to avoid power disconnections, and has made provision for $4.2 million in bad debts, as it anticipates customers to come under increased financial stress later in the year.

The company said it was also talking to distribution companies and the Electricity Networks Association about how to provide financial assistance or relief to keep customers connected.

Similar initiatives were being discussed among the major telecommunication companies, the chairman Paul Ridley-Smith said.

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“No tangible arrangements have emerged yet but Trustpower is maintaining a constructive dialogue.''

Announcing its full year results, the Tauranga-based power company shrugged off several challenges to post a net profit of $97.6 million, up $4.9m or 5 per cent, for the year to March 31.

Low lake levels and warm temperatures lowered both demand and generation at various times of the year for Trustpower.

Contributing factors were a $16m gain from the sale of its meter asset business, and an increase in the fair value of its hedging contracts.

But warm temperatures in autumn, low rainfall in spring and a surprise outage at its Highbank plant in Canterbury all hampered its operating earnings, pushing them down 16 per cent.

Operating earnings were $186.5m, at the lower end of revised guidance.

Some improvement is forecast for the coming year, with a range of between $190m and $215m.

Commercial consumption is expected to be down 35 per cent because of factory and retail shutdowns in April and early May.

During the year chief executive David Prentice said Trustpower pressed ahead with more services, particularly wireless broadband, which has hit the 100,000 customer milestone.

It also still plans to move into mobile phone services using Spark's tower network, although in the current climate, it was still at the testing stage.

Next year's forecast assumes average temperatures and residential electricity use, and that generation volumes will be below the long-run average because of dry North Island conditions.

A final dividend of 15.5 cents was declared.

This story has been updated to correct the provision for bad debts