‘What went wrong?’: Timaru councillor questions decision by lines companies to drop proposal to combine operations
Wednesday, 27 May 2026
The Timaru council’s commercial and investment arm is yet to learn the finer details around a decision by two South Island lines companies to drop a proposal to combine operations.
In December, South Canterbury’s Alpine Energy and Otago’s Aurora Energy issued a joint statement announcing they were exploring options for shared operations.
The initial statement said the lines companies were “choosing to work together to combine their operations to deliver better outcomes for customers” rather than investing separately in the same skills and systems.
“These discussions began earlier in the year but deliver to the minister of energy’s call for deeper collaboration and integration across the electricity distribution sector to lift the sector’s performance and better manage future cost pressures,” the statement said.
However, five months on, any plan to collaborate had been scrapped, with another joint statement released on May 15 saying the two entities had decided not to proceed with the proposal.
“Following detailed assessment work, both organisations concluded that the model does not deliver sufficiently compelling long-term consumer benefits to justify the cost, complexity, and risk involved,” the second statement said.
Alpine Energy was owned by Timaru District Holdings Limited (47.5%), LineTrust South Canterbury (40%), Waimate District Council (7.54%) and the Mackenzie District Council (4.96%).
Timaru District Holdings Ltd general manager Frazer Munro and chairperson Mark Rogers were asked about that decision at a Timaru District Council meeting on Tuesday as they presented the company’s quarterly report to March.
Councillor Stu Piddington asked the pair to throw some light on “what went wrong’’ with the proposal.
“It was trumpted a while ago … then the briefest of statements comes out saying it’s not going ahead.
“I wonder if you could throw some light on what went wrong because it seemed so positive at the start.’’
Rogers said a full shareholders update was yet to be received.
However, Munro said he did not think it was a case of anything going wrong.
“I think they took a really thorough look at the options and decided it wasn’t [going to provide] the benefits that they needed,’’ Munro said.
“But, like Mark says, we’ve got an update coming on … more of the detail around that.’’
Piddington said he was interested in what the reasons were and wondered whether it could have been a case of Alpine being too small, or Aurora “too big’’.
Aurora Energy owned and operated a network that delivered electricity to about 96,000 customers across Dunedin, Central Otago and the Queenstown-Lakes District, while Alpine Energy distributed to about 34,000 customers across South Canterbury.
Together, the companies serviced more than 20% of the South Island’s electricity customers.
Aurora Energy was a wholly owned subsidiary of Dunedin City Holdings Limited, which was owned by the Dunedin City Council.
In December, the lines companies entered into a Heads of Agreement to work together, and the boards established a joint steering group to recommend how they would integrate their operations.
A statement issued at the time said both companies faced “similar challenges as the energy system evolves” and rather than invest in new skills, systems and capability separately, they were choosing to work together.
In 2025, Alpine Energy posted a $12.1 million loss following the discovery of a historical error that led to the overcharging of customers over nine years, with the Commerce Commission ordering a $16.9m refund following an investigation.
The holding’s company received no dividend from Alpine Energy for 2024-2025, a far cry from 2019 when $2.75m was delivered that had followed $2.65m and $4.7m in the two years prior.