Mercury’s payout to shareholders is rising, but so are its power prices
Tuesday, 25 February 2025
Mercury Energy customers have been warned the price of gas and electricity could rise “across the board”.
The gentailer warned of the price hike on Tuesday, at the same time as it announced an increased payout to shareholders.
Chairperson Scott St John said Mercury had faced significant challenges in the first half of the year, including inflationary and cost of living pressures.
Mercury Energy customers will pay an average of 9.7% more come April and have been warned the cost of gas and electricity could rise “across the board”.
The gentailer warned of the price hike on Tuesday, at the same time as it announced an increased payout to shareholders.
Mercury declared a half-yearly dividend of 9.6 cents per share for the first half of 2025, up 3% on the first half of 2024.
Its forecast full-year dividend of 24 cents per share, if realised, would be the 17th consecutive year of dividend growth.
Mercury, which is 51% owned by the Government, said retail prices needed to rise because of increases in lines and transmission charges and increases in the “cost of wholesale electricity and other costs”, The Post reported.
The Commerce Commission has warned householders to expect to see monthly power bills increase by at least a $10 from April.
Increasing costs for material and labour, higher interest rates, and rising levels of investment in the electricity network had combined to cause the increase, it said.
Mercury chairperson Scott St John said the first half of the year had been marked by significant challenges, including inflationary and cost of living pressures.
Low hydro storage and gas supply constraints had further squeezed the “increasingly intermittent renewable supply”.
That had led to increased price volatility which impacted some industrial consumers without fixed price contracts, St John said.
“Collaboration from sector participants was key to helping manage this tight period, including demand response from industrials.
“Discussions to explore market options for the Huntly power station will be one of the important measures we take into the future to help improve security of supply.”
Despite the challenging conditions, Mercury continued to work towards growth in new renewables, he said.
“We’ve seen good progress on our commitment to investing over $1 billion in new renewables, with three renewable projects under construction – enough to power up to 142,000 houses with renewable energy.”