ComCom warns Alpine Energy

The Commerce Commission (ComCom) has warned South Canterbury-based Alpine Energy after an accounting error resulted in it overcharging customers by $16.9 million.

ComCom says it has also secured customer refunds plus $1.5 million for a community fund.

The commission’s focus was on ensuring Alpine returned the money it had overcharged customers with additional funds committed in recognition of the harm the error caused the wider community, says commissioner Vhari McWha.

“We’re mindful that, given electricity is an essential service, consumers may have suffered unnecessary hardship as a result of this error,” she says.

“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.”

McWha says unpicking the effects of the error had been a lengthy but essential process to ensure the correct amount is returned to consumers.

“While we do not think the breaches were intentional, they are nonetheless very serious and preventable,” she says.

“The undertakings therefore also require Alpine to make improvements to its processes so it can avoid making similar mistakes in the future.”

The lines company, which services more than 33,800 customers, provided incorrect information disclosure statements to the commission relating to its depreciation calculations, ComCom says.

“This information was used by the commission to set allowable revenues and Alpine’s maximum allowable revenue was overstated, leading to customers being overcharged for the lines components of their electricity bills between 2015 and 2024.”

The enforceable undertakings include Alpine establishing a programme to provide discretionary payments to former customers who would otherwise not receive a refund, within two years spend at least $1.5 million on initiatives to support access to electricity in the local community, like community resilience, affordability and energy efficiency; and prepare an improvement plan setting out actions Alpine intends to take that are designed to mitigate the risk of a similar error occurring in the future.

The commission says it has also issued a warning letter to Alpine.