Recent trends in revenue and demand
Westpower’s revenue from distribution line charges has increased over recent years. Revenue from line charges, which made up most of Westpower’s revenue, increased by around 7% from 2008 to 2011, over and above inflation. Distribution line charge revenue from residential and smaller commercial customers increased by 8%, and from medium-sized customers by 14%. Almost half of Westpower’s revenue is from residential and smaller commercial customers.
The increase in revenue from distribution line charges was due to a combination of demand and price increases.
The average price change varied across customer groups:
- The average price per small and medium customer connections grew 3% and 12% respectively. The average price per unit of electricity delivered to small and medium customers both increased 4%.
- The average price for large customer connections decreased 16%. The average price per unit of electricity delivered to large-sized customers decreased 34%.
Overall demand growth on Westpower’s network was mixed. The number of small and medium customer connections grew 4% and 2% respectively. Medium customers increased electricity consumption by 10%, while small customers increased consumption around 4%. The largest five customers experienced high demand growth with consumption increasing by over 40%.
Westpower is a consumer owned trust and only subject to information disclosure regulation. Westpower may choose to re-distribute part of its revenue to its consumer-owners or to community projects.
Recent trends in expenditure
Westpower’s total operating expenditure grew 3% per year over and above inflation. The majority of operating expenditure was directly related to the network.
Capital expenditure peaked in 2009 and halved in the two years after that. This may reflect the winding down of a large project.
Network operating expenditure is forecast to grow steadily over the coming years. Network capital expenditure generally tails off over time. Westpower forecasts a sharp decline in network capital expenditure over the coming years.
Recent trends in service reliability
The average duration and frequency of interruptions were above the industry average in 2009, 2010 and 2011.
Full analysis
The full analysis of Westpower'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.
