Electricity pricing: Is Stewart Island fast becoming unaffordable?

Some Stewart Island residents are experiencing “extreme hardship” because of the cost of electricity.

The cost of electricity is three times higher on Stewart Island than it is in Invercargill.

Stewart Islanders are in a state of limbo as they await the formation of a new Government to help address the “urgent” electricity situation.

Electricity on Stewart Island is three times higher than Invercargill, and with diesel to increase in December, it’s expected it will become even tougher for many to call Stewart Island home.

A steering group setup to work through the situation has pointed to the electricity prices leading to “extreme hardship”.

The Southland District Council owns the Stewart Island Electrical Supply Authority [SIESA] with electricity powered by diesel generators.

The rise in diesel prices and the quest to push for renewable energy on the Island has led to a rethink.

However, the election, and in turn the period of changing the Government, has slowed the work.

As part of the Government’s budget in May, it had earmarked a fund through the Government’s Climate Emergency Response Fund, aimed at establishing renewable electricity systems on domestic islands.

As part of this $300,000 was allocated for the development of a renewable energy solution for Stewart Island.

The Ministry of Business, Innovation and Employment is now waiting for the new government to be formed and the energy minister to be appointed before the matter progressed.

A letter has been drafted to put to the new ministers as soon as the new Government was in place and roles allocated.

Southland District Mayor Rob Scott said prior to a council meeting on Wednesday they were in a bit of limbo as they await the incoming Government.

“The cost of diesel is up there and it’s certainly having an impact on price where [Stewart Islanders] are paying three times the price of a normal Mainland power supply. They are paying about 84 cents per unit there at the moment.

“And diesel is obviously not the cleanest and greenest way of generating power, so we are looking at some solutions there.

“We had some funding from MBIE set aside to help build a business case and this is sort of in limbo between Governments at the moment. So, it’s just an update [for ministers] filling them in so they can hit the ground running with this project that’s been going on for some time.”

The briefing letter explains how Stewart Island residents are experiencing “extreme hardship” because of the cost of electricity.

“The small population, 440 residents, are unlikely to be able to fund the capital costs of renewable supply. Hence robust indicative and detailed business cases are essential for considering investment options such as seeking private or government investment, or a mix of both.

“Your agreement to approve the completion of the contractual arrangements with Ministry of Business, Innovation and Employment is urgent,” the briefing document says.