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Infratil Monthly Operational Report
4 May 2012
Infratil Monthly Operational Report April 2012 is available here.
Infratil’s latest Update
newsletter covers presentations given at the March investor day.
Despite difficult economic conditions, Infratil’s businesses had a good year with consolidated earnings forecast at the top-end of projections and indications that positive momentum is being maintained into the next financial year. However, an environment with many uncertainties makes new investment a particular challenge and Infrail’s approach to dealing with this is outlined in the Update.
Also highlighted are encounters with economic regulation; in public transport, emission reduction and residential electricity. In each case regulation intended to enhance market efficiency, transparency and accountability can be seen to be delivering for consumers and/or the environment as well as providing incentives to invest.
A comparative analysis of residential electricity prices in Victoria, Australia and New Zealand illustrates the difference in outcomes between regulation which seeks to enhance market efficiency versus that which seeks to reshape a market to fit the regulators’ vision (while sending the bill to consumers).
Coincidentally the NZ parliamentary committee considering the legislation required to allow Government to sell shares in the energy SOEs has been hearing submissions which have drawn attention to the burden on households of higher energy prices and sought to link household energy costs with continued 100% government ownership. As the Update shows in its comparison of Victorian and New Zealand household electricity costs, an efficient market can be a better way to lower prices than aggressive direct intervention.
Work progressed on the review of Infratil’s 82% interest in Perth Energy. Following earlier reviews, PWC has been appointed to undertake the sale of Infratil’s 100% interest in Glasgow Prestwick and Kent Manston airports.