27 Aug 2011

Genesis Energy says price rises inevitable

12:13 pm on 27 August 2011

Publicly-owned energy company Genesis Energy says price rises are inevitable due to expected increases in network and generation costs.

The electricity generator and retailer lost $16.6 million in the year to June because of impairment charges from buying the Tekapo A and B power stations. The previous year it had made a $69.3 million profit.

Stripping out one-off items and adjustments, Genesis chief executive Albert Brantley says the company's underlying profit fell 28% to $63.5 million due to subdued demand and weaker wholesale power prices.

Power companies are warning that wholesale prices need to rise to ensure more generation is built to meet future demand and Mr Brantley says retail prices will follow.

"I think you have to be realistic, there's going to be some creep on prices and ... they will come progressively over the next few years."