Last Friday, the Wellington-based commission released its proposals on the form of control it intends to impose on Babcock and Brown-owned Powerco and on Vector and its NGC subsidiary.

The commission said it would not be amending its provisional authorisation process, as previously indicated, but focusing on progressing towards a final authorisation.

The commission said it had considered the following broad forms ¡V the rate of return, total revenue cap, average revenue cap, weighted average price cap, disaggregated price cap, and sliding scale regulation ¡V as possible means of control.

Its preliminary view was that the weighted average price cap was the preferred form of control for standard consumers and the total revenue cap for non-standard customers and metering services.

It also released a discussion paper that included such questions as:

„X Were there any other options for control that the commission should consider?

„X Were there issues with an initial five-year control period, starting in August last year?

„X Were there issues with using financial incentives to regulate quality?

The commission is now calling for submissions from interested parties, with a closing date of August 7 and a conference to be held in Wellington on September 5-6. It will present its draft decisions for further consultation by early 2007.

The commission took direct control of Auckland-headquartered Vector and New Plymouth-headquartered Powerco late last year ¡V following complaints that their gas charges were excessive and that the firms were abusing their monopoly positions ¡Vordering Vector to drop its average prices by 9.5% and Powerco to cut its charges by 9%.