Media release – immediate circulation
8 March 2021
Waitomo Energy Services Customer Trust (WESCT) Customers are being encouraged to vote in support of selling three small electricity generation assets owned by The Lines Company (TLC).
WESCT Chair Peter Keeling believes a ‘yes’ vote in selling the hydro assets is in the best interests of WESCT’s beneficiary customers.
Voting papers were posted to all WESCT Customers on 8 March, with voting closing at midday on Tuesday, 30 March.
In a letter sent to WESCT Customers with the voting papers, Mr Keeling has outlined the rationale asking for support to sell the assets.
“On behalf of WESCT, the Directors of TLC are continually looking at ways of improving the Company’s performance,” says Mr Keeling.
“In recent months, this has involved considering the future of three small run-of-river hydro-generation plants at Te Anga, Mangapēhi (both of which are in the Waitomo district), and at Matawai near Gisborne. The work carried out is now at the stage where, subject to WESCT Customer approval, TLC wish to sell these stations.”
Mr Keeling says the Trustees are unanimous in their belief the sale of TLC’s generation assets will be good for the Company, ultimately benefiting the WESCT Customers.
“The Trustees have confidence the Company is performing well. The sale is one action taken by the Board that will result in longer-term benefits to the WESCT Customers. Please be assured this sale will not be a precursor to the sale of other major assets or the Company,” adds Mr Keeling.
An accompanying brochure sent out with the voting papers states the sale will see money currently tied up in these assets reinvested into other areas of TLC’s business.
WESCT requires, under its Trust Deed, a majority vote by a poll of WESCT Customers to determine a response to the proposal, says Mr Keeling.
The Trust Deed was formed in the early 1990s when TLC had several large hydro generation plants. The plants were key legacy assets at the formation time of WESCT, and the community wanted to protect their ownership. However, government regulation changes during the 1990s meant the Company owned by WESCT could not continue to hold those assets.
TLC subsequently purchased the existing and smaller hydro plants, but the Trust Deed was never updated to reflect this change; therefore, these are not the original generation assets the community wanted to protect ownership of, and a poll regarding their potential sale is still required.