Last week a language app named kaitiakitanga the most beautiful word in the world. Guardianship. Caring for what we have so it is still there for the ones who come after us. A fitting choice, they said, for an age worried about the future.
Here in Auckland do we live it?
This year your Entrust dividend is $372, up from $364. Something to enjoy. Lunch once a week.
What does that cheque sit on top of? The low voltage lines running along your street are getting older. Last year around 13% were past their expected lifespan. Now it is 15%. Going the wrong way.
So we say the word, and the world hands us a medal for it. When it comes to the wires, we are not doing the thing the word means. When it comes to the wallet, we take the money and look away.
That dividend does not come from the network making a healthy profit they paid out ~85% of their free cashflow last year. A large part of it comes from capital contributions, the charges new homeowners pay the day they connect to the grid.
So the money handed to households already connected is coming out of the pockets of the people wanting joining and paying a $16,000 premium above its efficiency depreciated replacement cost. We are spending Auckland’s power distribution future to buy lunch today.
When the AEPB was wound up in the 1990s, some households got a cash payout and their promise to underground the lines ended.
Others had their connection value rolled into what is now Entrust, crudely worth ~$10,000 a connection at yesterday’s share price. A $10,000 asset that returns you $372 a year, while the network it is meant to guard keeps ageing.
I have watched an old cross-arm snap in Takanini. The bang was huge. These assets are now managed by observation and probability.
That is what happens when the priority is the dividend and not the network.
Entrust holds the majority of the Vector shares and are mandated to pay a cash return, first and foremost.
Let us join some dots. The chair of Entrust is also Head of Advocacy at the NZ Property Council.
How do we advocate to change the structure when the dividend is the whole point?
If we actually believed in the word the world just praised, we would stop taking the handout and put it back into a modern network. Instead we maintain, barely, and pass the bill to the next homeowner.
Then we all wonder why houses cost so much and get angry when the storms knock out our power, or even possibly power to healthcare centres.
We have the most beautiful word in the world. It is time we meant it.
New Zealand National Party, what are you going to do to fix this?