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Electricity firm extends run of losses

NZN 26/03/2017 Jonathan Underhill

Wellington Electricity Distribution Network has extended its run of losses since the utility was acquired by Hong Kong billionaire Li Ka-shing in 2008, although the 2016 result was the smallest loss to date.

The company reported a loss of $1.9 million in calendar 2016, down from a loss of $3.9m a year earlier, the Wellington-based company's annual accounts show.

Sales climbed to $180m from $174m but earnings were wiped out by depreciation on its distribution lines and interest payments on some $733m of debt.

The capital city's electricity distribution company has been something of a hot potato since Wellington City Council transformed its Municipal Electricity Department into Capital Power and the Hutt Valley Electric Power Board was turned into Energy Direct in 1993.

They were acquired and merged by Canada's TransAlta in 1996, which transformed into United Networks in 1998, only to be acquired by what was then Vector in 2003.

In July 2008, Cheung Kong Infrastructure Holdings Ltd and Hong Kong Electric Holdings acquired the network and created Wellington Electricity, recording a loss for the 2008 year of $4.7m. The losses peaked in 2011 and 2012 at around $19m.

Wellington Electricity's lines network delivers electricity to about 160,000 homes and businesses throughout Wellington, Porirua and the Hutt Valley areas.

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