Price increase for Orion customers
Orion will be increasing its household prices by an average of 7.1% from 1 April 2024, with major customers increasing about 3.9% on average.
Orion is the electricity distributor throughout central Canterbury, with over 224,000 customers across 80,000 square kilometres. The Orion network extends from the Waimakariri River in the north and the Rakaia River in the south, and includes Banks Peninsula.
There are several reasons for the increase, including a Consumer Price Index uplift in regulatory costs and levies and general cost increase pressures.
An electricity bill is made up of Transpower transmission charges, lines charges determined by distributors and retail costs determined by electricity retailers. Orion’s charges for distribution represent 27% of the average household power bill. The remainder of the bill is made up of transmission, retail, metering and industry levy charges and GST.
“When setting prices, we do so with the objectives of fairness, sending price signals to consumers (incentivising better times and rates for people to choose to consume energy), avoiding bill shock, and consistency with the regulatory pricing principles. We set prices to recover the total revenue allowed by the regulator, the Commerce Commission over the pricing year to meet our aims and objectives,” says Orion General Manager Future Network David Freeman-Greene.
Orion’s aim when reviewing pricing is to balance price levels with providing our community with a safe, reliable and resilient electricity supply service.
“An average household will pay $9 more a month in distribution charges, and of course that will vary the more or less people use. How people use their electricity is what drives the differences per household.”
Customers on a controlled rate will also get a discount on charges. Like roads, electricity networks have capacity limitations. A controlled rate helps Orion to manage our network during “rush hours”, like very cold winter mornings or evenings.
“For example, if a customer allows us to switch off their hot water cylinder for short, daily peak periods they should achieve savings and generally speaking their water temperature shouldn’t be affected. So choosing to be on a controlled rate can help you towards a slightly lower bill,” says David.
Orion has introduced a new low rate period to encourage electric vehicle charging between 3am and 5am. This is typically a time on the network with lots of capacity and will help avoid this emerging load adding to existing peak times or ”rush hours”. This in turn will avoid unnecessary investment by Orion, helping to keep overall costs down.
The Commerce Commission sets how much revenue Orion can collect through prices. This happens every five years, with the next review setting revenue from 1 April 2025 for the following five years. Customers will see price increases flow through because of this process.
For more information about Orion's prices, visit: Orion pricing guides and information