Powerco
Powerco is New Zealand's second largest electricity and gas distribution business with over 400,000 connections across a service area of over 39,000 square kilometres in New Zealand. It also has a gas network and retail business in Tasmania, Australia. In New Zealand, Powerco's electricity distribution business is regulated via price and quality thresholds while its gas distribution business operates under provisional price control. The Tasmanian gas business is not subject to specific economic regulation.
Powerco's businesses provide an essential service to a broad and stable customer base that generates a steady stream of cash flows which underpin BBI's distributions.
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Description
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Electricity and gas distribution
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Asset Class Segment
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Energy Transmission and Distribution
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Location
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North Island of New Zealand and Tasmania, Australia
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Acquired
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November 2004
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BBI % ownership
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100%
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Regulatory Environment
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Subject to economic regulation in NZ:
- NZ electricity operates under a price and quality threshold
(CPI-X) regime. Reset is due in 2009
- NZ gas operates under provisional price control
- No economic regulation in Tasmania
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Customer Base
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Broad, low volatility customer base, diversified both regionally and by customer class. Electricity and gas customers are largely residential, generally contracted via retail energy companies
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Asset Age & Condition
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Electricity: < half economic life (25yrs)
Gas: < half economic life (18yrs)
Assets in good condition commensurate with age
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Utilisation
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11.2 electric customers per km and 23Gj per residential gas customer
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Key Drivers
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Energy demand and consumption levels
New connections as a result of new housing developments in all areas
Regional economic and population growth
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See the ASX Announcements, Presentations and Related Sites section of this website for more information on this asset.