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Evolving into an infrastructure play

Opinion Piece
Editorial

A tour of the Far East Sawmill and WET Gisborne Ltd for The Herald this week was an eye-opener to the scale of what has been achieved so far and the potential — yes, at considerable investment risk to Eastland Community Trust on behalf of all of us, its beneficiaries.

Interviewed afterwards, ECT chief executive Gavin Murphy acknowledged those who helped to build up this trust now worth $333m that emerged from electricity industry deregulation in the early 1990s, and the assets of the Poverty Bay Electric Power Board then valued at $20m — describing it as a “taonga we have inherited”.

Asked about the push by some for ECT to instruct Eastland Network to lower electricity charges or return dividends direct to consumers, Mr Murphy said trustees had discussed this after the call to do so from the Tairawhiti Residents Association and decided “no”. When he attended electricity trust meetings, people from other trusts were envious of the model in Tairawhiti.

He was also asked how he would respond to those who say it should have been Eastland Group driving the effort to create a wood cluster:

“I think that’s a fair question and I think as we evolve that site it’s very much a live discussion with the company. It’s also turning into more of an infrastructure play (so) it might logically be a better place, rather than a market intervention, which isn’t their gig.

“In many ways it’s similar but slightly different to the port. So the port was the same situation where ECT acquired the port and did immediately tuck it into Eastland Group. The difference there is it was an infrastructure play but the fundamental question about the forest estate, shipping and logs was a known market, so it was a question of infrastructure fit for purpose. This one has needed some early start-up economic development oversight for a period of time, but as it morphs into a slightly more mature position it becomes more of an infrastructure play. And things like heat plants and power and stuff are the next and necessary steps, and are right in their wheelhouse.

“It’s a real conversation with the company right now and I think we’ll look back at it and ask ‘should we have done it from the start or earlier?’ It’s a fair question.”