The Government’s Emissions Trading Scheme (ETS) will take effect from 1 July 2010.

What is the Emissions Trading Scheme?

The ETS is a government imposed cost on all electricity production that emits greenhouse gases, reflecting the volume of greenhouse gases produced by the electricity industry as a whole. This provides an incentive for generators to invest in further renewable generation capacity.

Why is the price of electricity and gas going to increase?

The energy sector is one of the sectors that will be included in the Emissions Trading Scheme from 1 July 2010. This will result in an increase to the wholesale price of electricity and gas which will in turn increase the retail price of electricity and gas.

How much will the price of electricity and gas increase by?

Mercury Energy will be increasing its retail energy prices as a result of the ETS. This will add, on average, an additional $5.00 per month (3.3%) to residential customer’s electricity bills and $1.75 per month (2.4%) to residential gas bills. This is based on an average household usage of 7,585 kWh pa, includes GST and reflects the prompt payment discount.

The Government has long provided strong encouragement to New Zealand’s energy sector to invest in renewable sources of energy. Mighty River Power has in recent years invested one billion dollars into renewable generation. This is good for the security of supply of electricity but is also good for New Zealand in terms of our national carbon footprint.

If you would like to view Mercury Energy’s energy savings tips, please click here.

For more information about the Emissions Trading Scheme, please visit the Government’s Climate Change website www.climatechange.govt.nz.