Low Fixed Charge Tariff Option Investigation
Investigation of an alleged breach of regulation 14(1)(c) of the Electricity (Low Fixed Charge Tariff Option for Domestic Consumers) Regulations 2004 by The Lines Company Limited
In February 2014, the Authority received an allegation that the way The Lines Company Limited (TLC) determines a consumer’s variable charge breaches the Electricity (Low Fixed Charge Tariff Option for Domestic Consumers) Regulations 2004 (LFC Regulations). On 27 June 2014, the Authority’s Compliance Committee appointed an investigator to formally investigate TLC’s alleged breach of regulation 14(1)(c).
On 21 November 2014, the Committee considered the investigator’s report and decided to discontinue the investigation.
In making its decision, the Committee noted that:
- the Regulations are complex and open to interpretation
- there were varying opinions, including varying opinions by different external legal providers, as to whether the variable tariff for TLC’s LFC tariff is a variable charge as defined in regulation 4(1) of the Regulations
- in terms of the Authority’s Prosecution Policy, there was no reasonable prospect of conviction that TLC has breached regulation 14(1)(c) of the Regulations
- the Regulations would be best clarified through the regulatory amendment process.
The Committee also requested a copy of the investigation report be provided to the Ministry of Business, Innovation and Employment (MBIE), who administer the Regulations, for their information.
To help industry stakeholders understand the Authority’s decision, the Authority has decided to publish the investigator’s report that the Compliance Committee considered in deciding to discontinue the investigation. Readers should note that the Compliance Committee did not accept recommendation 1(f) in the investigator's report to recommend to MBIE that the LFC Regulations be clarified. The Authority has also redacted certain personal details from the report to protect the privacy of natural persons.