Clearance Given to EnergyDirect to Acquire 49% of Capital Power
30 September 1994
The Commerce Commission has cleared Lower Hutt based electricity and gas utility, EnergyDirect Corporation, to buy 49% of the Wellington electricity utility Capital Power Ltd.
Commission Chairman Alan Bollard said that careful consideration had been given to the impact of the acquisition on competition in the various energy markets in the greater Wellington area.
While the acquisition would mean that a small number of electricity consumers close to the border between the two electricity networks would lose the ability to switch networks, the Commission had concluded that this would not materially affect competition.
The other aspect which had received particular attention was the impact on the electricity retailing market. However, the number of substantial retailers able to compete in the market has persuaded the Commission that competition would not be significantly affected by the merger of the retailing interests of EnergyDirect and Capital Power.
Dr Bollard said that the Commission is keeping a close watch on developments in the electricity sector and will intervene if it believes that proposed groupings of companies in the sector could have anti-competitive consequences.
The Commission is still considering the application from Enerco New Zealand Ltd to acquire the 49% of Capital Power currently on offer by the Wellington City Council. A decision on that application is not expected before November.
Media contact:Vince Cholewa, Communications Officer
Phone work (04) 471 0180, home (04) 479 1432