Electricity Distributor Faces Big Surge Bill
The Age
Wednesday February 7, 1996
The south-eastern Melbourne electricity distributor United Energy faces a potential fine of up to $100,000 and a hefty damage bill after a power surge hit more than 70 Doncaster homes.
Televisions, video recorders, microwave ovens and computers suffered breakdowns when the surge struck in the early hours of Saturday morning.
The Office of the Regulator-General, the industry's competition watchdog, has launched a probe into whether poor maintenance left the company in breach of its licence. If the company is found to have breached its licence, it could become the first privatised power company to be fined by the regulator- general, Mr Robin Davey.
But a company spokesman, Mr Wayne Debernardi, said yesterday that he did not believe the company had breached its licence.
The power surge was one of the biggest incidents so far for the privatised electricity distribution industry. It comes amid widespread public concern that the newly sold companies are cutting back too hard on service and maintenance.
Ms Karen Chalmers, the general manager of customer affairs at the office, said the watchdog was particularly concerned by the extent of the damage reported in the incident and by the fact that it seemed to have been within the company's control, rather than caused by possums, birds or lightning.
United, formed in late 1994 from the Box Hill and Doncaster- Templestowe council electricity companies and parts of the former SECV, was the first distribution company to be privatised.
The State Government sold it last August for $1.55 billion to a consortium of the US power group Utilicorp, the AMP Society and the State Authorities Superannuation Board of New South Wales.
Mr Debernardi said the homes in Stanton Street and Log School Road, Doncaster, were hit after a fault at a pole sub-station.
Some 25 customers reported problems ranging from dimming lights to damaged appliances.
United had already door-knocked the affected area, he said.
It had also promised to pay ``reasonable compensation" to customers and had advised them on how to make claims. It was hard to say whether the damage bill would top $100,000.
United was also checking the quality of its workmanship and maintenance in the Doncaster area, Mr Debernardi said.
He said the quality and efficiency of electricity work practices had risen since the company was created.
Ms Chalmers said United's licence required it to observe an industry code of practice that bound it to undertake maintenance programs. If United had not observed its maintenance program and had breached the code, she said, the ``flagfall penalty" was $100,000 - although it would be up to the regulator-general to decide the exact penalty, if any.
© 1996 The Age