Entrust’s purpose is clearly outlined in its trust deed. It owns the majority share in a lines company (Vector) and is not responsible for other parts of the electricity system like transmission (Transpower), generators and retailers (e.g. Mercury, Genesis, Contact, and Meridian).
Vector consults with Entrust and retailers regarding changes to line pricing, but Trustees do not have the authority to lower its line charges.
Furthermore, the Commerce Commission sets the return Vector can make by regulation, which effectively then sets line charges.
Entrust operates at a governance level and does not provide operational direction.
The Trust deed is narrow and does not allow or require Trustees to use Trust resources to further matters such as energy technology, energy hardship or decarbonisation, so Trustees cannot get involved in these aspect of the electricity sector.
If Entrust funds were used to advance matters such as energy technology, energy hardship, or decarbonisation instead of those funds being paid to beneficiaries, Trustees could be found to be acting in breach of the Trust Deed.
Undertaking a new type of technology is the remit of the Vector board and is a matter on which Entrust can only influence Vector indirectly, via Trustees appointed to Vector’s board. Entrust can have two directors out of nine (maximum) on Vector’s board. All Vector directors, regardless of whether they are Entrust Trustees directors, or independent directors, must act in the nest interest of all shareholders, as a whole.
In essence, Vector directors have to act in accordance with their legal duties as a director, they are not “puppets” of Entrust.
Since its inception in 1993, Elections for Entrust since have been run strictly on a democratic basis with an independent returning officer running the election.
The C&R team, while very successful in gaining public support on the basis of their performance, have not held all 5 positions every election.
Entrust’s two directors on Vector’s board (out of a maximum nine) have supported significant world-leading innovation coming out of Vector, including partnerships with GoogleX and Amazon Web Services. Read more about them here.
Vector is also widely known for its Taskforce on Climate Related Financial Disclosures (TCFD) reporting and is leading New Zealand, and arguably, the world in this respect. This work is strongly supported by C&R trustees.
Examples of initiatives C&R reps on Entrust have led (while adhering to the Trust deed which strictly mandates what Trustees can do) are:
Vector is currently one of the better performing companies in NZ.
At its recent AGM, it announced a strong result, citing a group net profit after tax of $79.9 million with adjusted earnings up 14% to $365.2 million. Total capital expenditure for the year was $510 million.
Vector has undertaken some world-leading innovative initiatives, including partnerships with GoogleX and Amazon Web Services.
Vector has been investing half a billion dollars annually into Auckland’s electricity network to ensure consumers have the future power network they will need, including significant investment into resilience against climate change
Entrust’s two directors on Vector’s board (out of nine maximum) have strongly supported those initiatives.
For solar and battery solutions to be rolled out, there would need to be a way to fund this. One may assume that this could be funded out of the NDREOR fund from which undergrounding is funded, however this is not the case. (Note: NDREOR is the agreement document between Entrust and Vector).
Vector is a commercial company and needs to make a return on investments it makes and though undergrounding is paid for out of the NDREOR, the background is a bit more complicated as Vector is regulated.
Undergrounding projects selected by Vector are included in something call a RAB (regulated asset base), which means the Commerce Commission has agreed that Vector can make a financial return on them.
The Commerce Commission would not allow solar and battery solutions to be included in the RAB (regulated asset base), which would mean Vector could not make a financial return on a rollout – this means solar and battery cannot be paid for from the same fund as undergrounding.
The only other way to fund a solar and battery initiative would be on a commercial basis with Vector making a commercial return. Vector has to work in the best interests of all shareholders and customers, so could not subsidise a rollout of solar and battery to people in the Entrust district at the expense of others. A lot of other companies sell solar and battery products, so it’s not a space that Vector is focused on at this point in time.
Vector has a track record of innovation with new technology with an example of that being the introduction of large scale batteries for network purposes.
No one can believably promise cheaper power when Entrust (and its ownership of Vector) are just one part of the electricity sector.
Vector’s line charges have actually fallen in real terms over the last several years as a proportion of average consumer’s power bills. Generator-retailers (like Mercury, Contact, Meridian, and Genesis) have significantly increased their prices.
72% of Entrust's district is undergrounded (the most being in South Auckland). Entrust trustees don't select what areas are to be undergrounded, Vector does. They often choose in tandem with Chorus' work programme. Additionally, if residents are prepared to pay themselves, they can initiate a project in their own street.
In the 2021-2024 Entrust term, large scale projects in Mt Roskill and St Heliers were completed, and a new project in Beachlands has just been announced.
No one can believably promise cheaper power when Entrust (and its ownership of Vector) are just one part of the electricity sector.
Vector’s line charges have actually fallen in real terms over the last several years as a proportion of average consumer’s power bills. Generator-retailers (like Mercury, Contact, Meridian, and Genesis) have significantly increased their prices
Entrust cannot demand that Vector roll out an initiative they think will be beneficial to the company because Entrust operates at a governance level and does not provide operational direction.
The Trust deed is narrow and does not allow or require Trustees to use Trust resources to further matters such as energy technology.
If Entrust funds were used to advance matters such as use of a certain energy technology instead of those funds being paid to beneficiaries, Trustees could be found to be acting in breach of the Trust Deed.
Undertaking a new type of technology is the remit of the Vector board and is a matter on which Entrust can only influence Vector indirectly, via Trustees appointed to Vector’s board. Entrust can have two directors out of nine (maximum) on Vector’s board. All Vector directors, regardless of whether they are Entrust Trustees directors, or independent directors, must act in the nest interest of all shareholders, as a whole.
In essence, Vector directors have to act in accordance with their legal duties as a director, they are not “puppets” of Entrust.
Finally, analysis of any new technology must be carefully undertaken by Vector so that it maintains its profitability and therefore ability to distribute a dividend.
The number of people the dividend must be distributed to has gone up exponentially (by over 45,000 in the last 10 years). Auckland’s population is the fastest growing in NZ and yet the dividend still remains around the $300 mark ($350 this year). This is a remarkable achievement.
A total of $127 million was distributed to 360,000 Entrust beneficiaries this year and it is the highest-ever total despite year-on-year population increases.
The annual dividend payment is of great importance to thousands of ordinary Auckland families.
Completely untrue. There is no credible evidence to support this.
There is a link to the official website for the Entrust election on Entrust’s front home page. It is not appropriate for Entrust or it’s Trustees to get involved in the election.
An independent returning officer with electionz.com runs the election process via a separate website. They also run local government elections around New Zealand too.
The parameters of the election and voting period are mandated in the Trust Deed. Trustees do not have the ability to extend the voting period. For this reason the Returning Officer has made ten voting bins available at Woolworths supermarkets across the Entrust District.
The dividend comes from the majority ownership of Vector. The dividend is paid as soon as possible after Vector pays its dividend so that beneficiaries receive their money promptly.
In 2024, Vector paid its dividend on 16 September, and Entrust paid its dividend on 20 September.
Completely untrue. There is a link to the official website for the Entrust election on Entrust’s front home page. It is not appropriate for Entrust or it’s Trustees to get involved in the election.
An independent returning officer with electionz.com runs the election process via a separate website.
