Infrastructure rates irk Gas Association

By Phil Boeyen, ShareChat Business News Editor

Monday 30th July 2001

The Gas Association claims consumers will be the losers as local government moves to impose rates on utility companies' distribution networks.

Association chairman, Peter Harcus, says the imposition of rates will have long term economic impacts.

"Christchurch City Council is the latest council to confirm that it will rate local utility distribution networks.

"To make matters worse, it intends to strike the rates at the highest possible level, suggesting that infrastructure networks providing essential services are the equivalent of industrial or commercial properties and somehow draw on the same services."

Mr Harcus says like any other business network owners already pay normal rates on land and buildings, and research shows that rates will create a significant disincentive to new investment in the infrastructure and will lead to higher energy and telecommunication costs for all customers.

"While it may be convenient for councils to pretend that big companies with deep pockets will pay, the reality is that companies cannot absorb the cost increases and will pass these on to consumers."

Mr Harcus says the Gas Association's top priority is to ensure that there are no rates on the networks, but at the very least it wants to help set up a code of practice and make sure that the costs associated with the rates are minimised.

Comments from our readers

No comments yet