City Vision for Entrust Policies

Auckland needs a team at Entrust (formerly the Auckland Energy Consumer Trust) who are committed to working together to maintain and protect your annual dividend and the reliability of our electricity supply.  

If elected we will:

Protect and maintain your dividend: We oppose any privatisation of Vector

Electricity reliability and resilience:  We will pressure Vector to improve the security of our electricity supply

Accelerate the current undergrounding programme

Sustainability, renewables, climate change and solar tax.  We will prepare for a rapidly changing competitive environment and the challenge of climate change

Establish transparency and good governance

Diversity:  We will appoint qualified directors to Vector that better reflect the diversity of Auckland and are able and committed to maintaining the dividend paid annually.

Protect the consumer: We will the resources of Entrust and Vector to address the growing energy poverty in our communities

Our Approach

We will seek independent advice on how to :

• Ensure Vector remains profitable;
• Make Auckland’s electricity supply more resilient;
• Deal with a rapidly changing competitive environment;
• Accelerate the current undergrounding programme;
• Ensure our interests as investors, consumers and the community can be appropriately balanced.

We will use that advice combined with regular consultation with and polling of our community, to build a shared vision of the future between Entrust trustees, Vector directors and our dividend recipients.   

Protecting the Dividend

There are four main threats to the sustainability of your $350 annual dividend;

• First, that parts of Vector’s assets are bundled up and the sale proceeds going to Auckland Council. (most likely) This will lower our dividend despite Entrust still holding the shares
• Second, that all or part of the Entrust 75.1% share will be sold, cutting or removing our dividend, and the sale proceeds going to Auckland Council. (likely)
• Third, the C&R trustees wind up the trust and give it all to Auckland Council. (unlikely)
• Finally, that the growing sources of electricity like solar on your own roof will reduce the profitability of lines businesses like Vector without changes in how we pay for services. (least likely)

The Vector Chair has confirmed he has been approached by the merchant bank UBS about a proposal for Vector to sell its network assets to a client to be introduced by UBS. The 5 current C&R trustees that have run Entrust for the last 9 years have not ruled out a sale of Vector assets with proceeds going to Auckland Council.

City Vision is strongly opposed to any sale of your share in Vector, held on your behalf by Entrust as it would cut or eliminate your annual dividend with the sales proceeds going to the Auckland Council.  We are equally opposed to an early wind up of the Trust that would have the same effect.

A City Vision trustees will use independent advisers to review the strategy and operations of Vector and then work with the board and management of Vector and the minority shareholders to develop a shared plan to best secure your future dividends.  

Electricity Reliability and Resilience

Consumers want Entrust to be a stronger advocate for improved reliability of our electricity supply.  We have never been as reliant on electricity for our quality of life as we are now and the introduction of electric vehicles as standard will only increase that dependency.  Our dependence on reliable electricity was highlighted by the storms back in April when 200,000 people suddenly found themselves without power, some for more than a week.

City Vision trustees will work with Vector to see how we can cost effectively increase the reliability and resilience of the Auckland network.  For some more isolated areas that might mean having a separate line in, somewhere else by utilising undergrounding,. Large modern batteries are now being used in parts of Australia as a back-up electricity supply.  “Consumer” was taken out of the name of the Trust by the current trustees.  City Vision will put both the interests of the consumer and trust back into Entrust.  

Acceleration of the Undergrounding Programme

We are committed to securing the supply of electricity and accelerating the undergrounding programme.  City Vision Trustees will look at ways we can underground faster.  

• The $10.5 million ring fenced by the Trust for undergrounding of lines in 2005 has not always been spent as intended.  In recent years it has been spent on projects such as lighting the harbour bridge and other projects which have nothing to do with securing our electricity supply.
• The current C&R Entrust trustees have allowed Vector to cut the spending on undergrounding so it will now take more than 1000 years to complete the undergrounding of poles and lines at the recent rate of progress.  
• A City Vision Entrust would thoroughly investigate alternate ways to bring undergrounding to more homes.  We all know it is expensive to replace the ugly old power poles but we are not prepared to wait over 1000 years.  
• If not part of a ‘planned undergrounding project’ (like in Sandringham or Franklin Road in older suburbs) each consumer must agree for their street to be undergrounded.  It comes at a substantial up-front cost per household.  An option is for consumers in streets that want to ‘buy in’ to undergrounding, without unanimous support for the project, could be offered funding to undertake undergrounding that would be paid off through the power bill over say 20-40 years.
• Better information could be used to find out which urban trees are a danger to powerlines and which power poles are involved in most accidents, and prioritise these for undergrounding.  Different priorities for undergrounding can be part of the discussion Entrust has with its consumers about what they see is important to them.

We need to put the Trust back in Entrust and embark on an under-grounding programme that will keep our power on and our communities safe.

Transparency and good governance

We will ensure that Entrust operates in an open and informed way by:

• Making information available about the Trust, and will provide information to media and beneficiaries unless good reason exists to withhold it;
• We will amend the Trust Deed to make the principles of the Local Government Official Information and Meetings Act 1987, apply to the Trust;
• We will hold meetings in public (only excluding for good reason);
• We will place Minutes, once approved, on the Entrust website;
• We will consult and poll on matters of major significance to consumers and dividend recipients.  
• After a year to assess the relative workload of Trustees we will review the $343,000 in the director’s fees paid annually to the trustees with the aim of reducing the total amount paid.  

City Vision for Entrust recognises that the severity and frequency of storms like the one last April is a resilience issue that applies today – not in some undefined future.  Climate change is happening now and Auckland’s power lines need to be better prepared.

Diversity

Neither Vector nor Entrust currently reflect the growing diversity of Auckland.

City Vision Entrust Trustees will:

• After a careful review of Entrust and Vector, refresh the Vector board with the aim of appointing qualified directors more reflective of Auckland’s diversity and are able and committed to maintaining the dividend paid annually;
• Use polling and meetings with representatives of the community to keep the Trust aligned with your priorities and more in tune with Auckland’s diversity;
• Encourage Vector to provide scholarships, internships and mentoring to help diversify its future workforce and improve its alignment with its customer base.

Sustainability

City Vision for Entrust acknowledges that Vector is a leader in sustainability and will encourage Vector to join the dots and pass innovations on to ordinary consumers.

• At the moment smart metering serves big users and power companies more than it serves ordinary households.  We want to see Vector empowering households to use their own data to save money.
• Smart meters and customers’ data represent the single greatest untapped potential in addressing climate change and sustainability goals.  

Solar Tax

The Electricity Authority labelled Unison’s solar tax as “not as clearly service-based and cost-reflective as it could be”, and not offering “sufficient choices to consumers”.  We couldn’t agree more.  The fact that the solar tax still passes muster under our electricity regime speaks volumes about the kind of reforms needed.

City Vision for Entrust will work collaboratively with ETNZ to sort out regulations that are fair for both the lines companies and customers.

Renewables

• Vector has invested significantly in both small scale and grid scale solar.  This experience is priceless and should continue.
• Renewables are key to reaching Vector’s stated goal of being net carbon neutral by 2030.
• Renewables are key to reaching Vector’s stated goal of being resilient in the face of climate change.  

City Vision for Entrust supports Vector’s investments in renewables and would like to see more integration within Auckland to provide resiliency.

Climate Change

Climate change is the single most important issue facing the energy sector.

• We support Vector’s goal of being net carbon neutral by 2030.
• Smart meters and customers’ data, represent the single greatest untapped potential in addressing climate change and sustainability goals.
• Renewables are key to reaching Vector’s stated goal of being net carbon neutral by 2030.
• Renewables are key to reaching Vector’s stated goal of being resilient in the face of climate change.

Protecting the consumer

Entrust was originally established as the Auckland Energy Consumer Trust to benefit the consumers but does little to address the needs of the consumers that it serves.  Our dividend is under threat, continuity of supply by Vector is often compromised and agreed undergrounding has not been carried out.  We believe Entrust should have spoken out about the consumer and business interest in a more reliable power supply in Auckland when 200,000 Aucklanders were without power last April.

Over the years of a C&R dominated Trust nothing has been done by Entrust to address the growing “energy poverty” (people not able to afford basic energy requirements) that has been highlighted in recent government reports.  Entrust and Vector should be using some of their resources to bring down prices and provide cheaper energy solutions for the most vulnerable.  Other lines companies in NZ have started to do this. A good example of this is in the Waikato where its line company Wel Networks partners with local charities to supply cheaper power to low-income consumers.  The current Entrust trustees are asleep at the wheel in addressing the energy needs of their consumers.

A City Vision majority Entrust as a stronger advocate for the consumer will press Vector to investigate opportunities for:

• Bringing forward the payment of the dividend for all to help the most vulnerable
• Reviewing the line charges to facilitate greater competition in the energy sector and deliver lower prices
• Implementing cost effective changes to improve the reliability and resilience of electricity supply in Auckland.