Southland Electricity Companies Increase Investment In OtagoNet
Electricity Invercargill Limited (EIL) and The Power Company Limited (TPCL) have announced the increase in their investment in the OtagoNet Joint Venture electricity network for an undisclosed sum.
EIL and TPCL have each held a 24.5% interest in the electricity network since 2002. The Marlborough Lines Limited 51% interest has been purchased by TPCL and EIL.
The Power Company Limited Chairman Alan Harper said “The increased investment by The Power Company in the OtagoNet network is a natural progression for us. The interest we have held since 2002 has been very successful and we believe this increased investment makes complete sense. While we have paid a premium for Marlborough’s interest the price is fully justified by the advantages we will secure with this network which adjoins The Power Company’s boundary.”
Neil Boniface, Chairman of Electricity Invercargill Limited concurred. He also commented that “We have made considerable improvements to the network since our original investment in 2002, and we look forward to continuing to improve the network for the benefit of OtagoNet stakeholders, including the network customers.”
Mr Harper also advised that “There are challenging times ahead, especially with the economic regulatory framework in place for electricity distribution businesses. However, that is part of our business environment and we will continue to ensure the investment in the network is a successful one for both our company and shareholders.”
Mr Boniface also added “The PowerNet staff, including the team in Balclutha and the Otago Power Services team have and will continue to make a significant contribution to the OtagoNet electricity network. Our ownership of those network management and contracting companies has been the key to the success of the network investment and means the electricity network is in very good hands going forward.”
The OtagoNet Joint Venture was formed in July 2002 following the purchase of electricity network assets from the shareholders of the consumer co-operative company Otago Power Limited. Three companies formed the joint venture. The joint venture partners were Marlborough Lines Limited (51%), The Power Company Limited (24.5%) and Electricity Invercargill Limited (24.5%). The OtagoNet area has over 14,700 consumers connected to the electricity network. The area is vast from near St Bathans in the north to the Chaslands in the south and inland from the Blue Mountains in the west
The Power Company Limited is an electricity network asset company formed in 1991. The company owns the electricity network assets in the Southland and West Otago area, excluding parts of Invercargill City and the Bluff township area. The Power Company has over 34,600 consumers and contracts PowerNet to manage the assets on its behalf. The Power Company Limited is owned by the consumers connected to the network and the Southland Electric Power Supply Consumer Trust exercises the ownership rights on behalf of those consumers.
Electricity Invercargill Limited is an electricity network asset company formed in 1991. It owns the electricity network assets in Invercargill City and the Bluff township area. The company has just over 17,200 consumers and has contracted PowerNet to manage the network assets on its behalf. Electricity Invercargill Limited is owned by the Invercargill City Council, through its subsidiary Invercargill City Holdings Limited. Invercargill City Holdings retains 100% ownership of the Company.