Recent trends in revenue and demand
The Lines Company’s revenue from distribution line charges has increased significantly over recent years. Revenue from line charges, which made up most of The Lines Company’s revenue, increased by around 25% from 2008 to 2011, over and above inflation. Distribution line charge revenue from residential and smaller commercial customers increased by 45%, and from medium-sized customers by 22%. Most of The Lines Company’s revenue was from residential and smaller commercial customers.
The increase in revenue is mostly due to prices increasing, but some of it was due to an increase in demand.
The average price increase varied across customer groups:
- The average price per small customer connection increased by around a third. The average price per unit of electricity delivered to small customers was around the same in 2011 as in 2008.
- The average price per medium customer connection increased by around 25%. The average price per unit of electricity delivered to medium-sized customers increased by around 130%.
The number of medium and large customer connections declined, while the number of small customer connections grew modestly from 2008 to 2011. The amount of electricity consumed fell by around 25% for medium and large customers but grew by around 40% for small customers.
Recent trends in expenditure
The Lines Company’s total operating expenditure increased 6% per year over and above inflation
Operating expenditure per customer and per unit of electricity was above the industry average, and operating expenditure km of network length was below the industry average.
Investment in the network increased faster than the size of The Lines Company’s business in recent years.
Forecast operating and capital expenditure has different trends between forecast rounds. The 2011 capital expenditure forecast predicts a decline in capital expenditure. The 2011 operating expenditure forecast predicts a slight decline in operating expenditure.
Recent trends in service reliability
The Lines Company’s average duration and frequency of interruptions was consistently above the industry average from 2008 to 2011. The Lines Company’s duration and frequency of interruptions were below their regulatory limits.
Full analysis
The full analysis of The Lines Company's performance from 2008 to 2011 can be downloaded below.
All dollar figures in our analysis are adjusted for inflation and expressed in 2011 dollars.
