About Nelson Electricity Ltd

In order to understand the current ownership of NEL it is useful to delve into a bit of history.

The first public supply of electricity in Nelson commenced in 1923 from the Power House on Wakefield Quay - a steam power generation station. This supplied the city at 3,300 volts. The supply from Power House continued as the only public supply until 1944, when the Cobb Hydro Station was commissioned; supplying the whole Top of the South region, and the Nelson city area was slowly converted to the 11kV network. The Power House continued to operate until 1964 at which stage the last of the 3,300 volt supply was banished from the city. Since then transmission lines have been erected to link the Top of the South with the hydro generation in the lower South Island.

The Nelson City Council (NCC) ran the "Municipal Electricity Department" or the Nelson City Council Electricity Department from 1923 up until 1991. At that time it contracted a 10 year lease of the electricity operations to Citipower (a subsidiary company of Capital Power, then TransAlta).

In accord with the provisions of the Energy Companies Act 1992, which required that all electricity authorities became commercial companies, the NCC formed the company Nelson Electricity Limited, of which it owned 100% of the shares.

In 1996, the Nelson City Council sold 50% of its shares in NEL to Network Tasman (then known as Tasman Energy) and the other 50% to Marlborough Lines (then known as Marlborough Electric). Although the ownership of NEL changed, the existing lease with Citipower remained and they continued to manage and operate the assets of NEL.

There was further change ahead however as the 1998 Electricity Industry Reform Act required that all electricity companies split into either the electricity network business or the electricity supply business. In effect the Act made it unlawful for an electricity company to generate and sell electricity while at the same time being in the business of operating power lines. Like the majority of other integrated power companies NEL decided to retain its network business as a result. In June 1999, the electricity retailing operation including 8,800 consumers was sold to Trustpower Limited. This also resulted in the termination of the Citipower lease which meant that Nelson Electricity became responsible for the operation of NEL's electricity network.



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