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What if we’d had price control in the good old days ??

What if we’d had price control in the good old days ??. A light-hearted look at the NZ power lines industry in the early years of the 20 th century. South Canterbury Electric Power Board, about 1927. C’mon Cyril … we’ve got to out-perform the economy-wide efficiency gain by 2.3%.

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What if we’d had price control in the good old days ??

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  1. What if we’d had price controlin the good old days ?? A light-hearted look at the NZ power lines industry in the early years of the 20th century

  2. South Canterbury Electric Power Board, about 1927 C’mon Cyril … we’ve got to out-perform the economy-wide efficiency gain by 2.3%

  3. 110kV line construction near Levin, about 1924 Hey George, what d’ya reckon the efficiency claw-back on this would be ?

  4. Addington transformer workshop, 1930’s Remember to roll this into the RAB at standard cost, Harry

  5. Hutt Valley Electric Power Board’s first pole, Petone, 1924 Ya know, indexed historical cost could be a suitable replacement for RAB, Fred.

  6. Waitemata Electric Power Board erecting pole, possibly 1920’s Well Tom, I’m really not convinced that Government Bonds are a good proxy for the risk-free rate.

  7. Bay Of Plenty Electric Power Board’s pole factory, 1927 Now remember, guys - your efficiency gains will be shared with customers at the next price re-set.

  8. So tell me again, Percy, why does the most efficient capital structure have 60% debt ? Wanganui Rangitikei Electric Power Board line gang near the Woollen Mill at Aramoho, 1925

  9. Waitaki Electric Power Board, 1925 Hey guys, I’m a bit worried that we might have over-run the efficient bench-mark cost for this job.

  10. Hey, Bill, I’m sure the price increase of bitumen is way above CPI Laying cables in Auckland, 1908

  11. Southland Electric Power Board erecting poles, 1920’s C’mon Albert, I’ll bet ya £2 that a hypothetically efficient new entrant wouldn’t do this.

  12. Franklin Electric Power Board first pole, 1925 Des, are you sure you considered the efficient non-network alternative ?

  13. North Auckland Electric Power Board trucks at the Mangawhai pub, 1946 Guess we’d better hold off those efficiency gains until after the next re-set

  14. Hopefully this won’t get optimised out of the RAB Wellington Municipal Electricity Department erecting a pole, 1935

  15. Ashburton Electric Power Board erecting a pole, 1935 Well, Eric, my view is that we really do need to allow for non-diversifiable risk when estimating the WACC.

  16. Marlborough Electric Power Board erecting its first concrete pole, 1920’s I reckon we could really do with a valuation methodology that safe-harbors marginal assets, George

  17. Marlborough Electric Power Board erecting its first concrete pole, 1920’s For insights on how price regulation works today, contact Phil Caffyn… Phone (07) 854-6541 Email phil@utilityconsultants.co.nz Web www.utilityconsultants.co.nz

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