Alpine Energy has been formally warned by the Commerce Commission and ordered to repay $16.9 million to customers after an accounting error led to years of overcharging.
The South Canterbury-based lines company has also committed to spending at least $1.5 million on initiatives to support local access to electricity as part of enforceable undertakings negotiated with the Commission.
Commerce Commission Commissioner Vhari McWha said the priority was to ensure affected customers were refunded and that Alpine took accountability for the wider harm caused.
“We’re mindful that, given electricity is an essential service, consumers may have suffered unnecessary hardship as a result of this error,” she said.
“That’s why in addition to paying customers back the amount they are owed, we have secured a commitment from Alpine to spend at least $1.5 million to support access to electricity in the local South Canterbury community.”
Alpine Energy, which services more than 33,800 customers across Timaru, Mackenzie, and Waimate Districts, provided incorrect information disclosure statements to the Commission, leading to its allowable revenue being overstated.
The Commission said this meant customers were overcharged on the lines component of their electricity bills between 2015 and 2024.
McWha said while the breaches did not appear to be intentional, they were “very serious and preventable.”
As part of the enforceable undertakings, Alpine Energy must:
- Refund current customers the $16.9 million overcharged
- Create a payment programme for former customers
- Spend at least $1.5 million over the next two years on local electricity access initiatives
- Prepare a comprehensive improvement plan to prevent similar issues in future
Alpine adjusted its prices from 1 June 2024 to help correct the problem. Refunds to current customers will be issued as credits on their accounts, and former customers may be eligible for payments through the new discretionary programme.
The Commission said it believed the customer refunds and the community support package offered a better outcome than pursuing a court-imposed penalty, which would have gone to the Crown.
Alpine Energy is partially owned by its connected consumers, with dividends passed back to customers through bill credits via a community trust.
The Commerce Commission regulates power lines companies under the Commerce Act, limiting their ability to earn excessive profits and requiring key financial and network performance information to be publicly disclosed.
A copy of the enforceable undertakings and warning letter is available on the Commission’s website.
