26 May 2010

Prices to rise when ETS covers power and fuel

3:17 pm on 26 May 2010

Consumers are being told to expect price increases across the board as power and fuel are brought into the Emissions Trading Scheme.

From July, fuel prices will rise by 3 and a half cents a litre, while power prices are expected to increase up to five percent.

Prime Minister John Key expects price increases for fuel and power will total only $3 per week per household.

But Federated Farmers says the ETS will gouge more than $500 million from consumers and businesses.

The Road Transport Forum, which represents trucking operators, says most goods travel around the country by truck, and as fuel prices rise, so will the cost of many other goods. It says the scale of price increases is unknown.

Not all to raise prices immediately

Genesis Energy and Trustpower say it's too early to say what the flow-on effect of the ETS will be for consumers.

Genesis public affairs manager Richard Gordon told Nine to Noon the company will consider prices after the scheme has been running for a few months.

He said it is hard to make an estimate of the effects because the cost of carbon is one of a number of variable costs for the business.