Prior to 1993 residents of Tauranga and Western Bay of Plenty purchased their electricity through the Tauranga Electric Power Board (TEPB). Following the Government’s 1993 restructuring of the New Zealand electricity sector, Trustpower Limited was formed and began developing a generation and retailing business.
The Tauranga Energy Consumer Trust (TECT) was established under a Trust Deed in 1993 in line with an agreed establishment plan. Under the plan 84 million shares were issued in the newly formed Trustpower. 49% were allocated to individual consumers (previous customers of TEPB) and 50% of the shares were allocated to TECT to establish the Trust.
The restructuring of the electricity sector saw more electricity retailers enter the market. TECT beneficiaries (consumers) were confirmed as those that held a Trustpower power account in the Western BOP. Western BOP residents who chose to purchase their power from another retailer were now no longer beneficiaries of TECT.
In 1999, further market reforms required the company to choose between generation/retailing and owning a distribution network. The decision was made to focus on generation/retailing and exit distribution.
TECT subsequently acquired additional shares through a share split and also additional purchase of shares bringing its total shareholding to approximately 103m shares.
In early 2015 the Trustees resolved to sell 20m of the Trust’s shares in Trustpower and invest the proceeds in a diversified portfolio with the aim of diversifying the asset base of the TECT Group. The sale of the shares yielded proceeds of approximately $155m.
In 2016, Trustpower underwent a demerger that created Tilt Renewables Limited. Existing Trustpower shareholders including TECT were issued one share in each of the new entities for each Trustpower share that they held. In 2018, TECT liquidated its holding of Tilt Renewables shares, yielding net proceeds on the order of $190 million. These funds have been reinvested through the Diversified Portfolio.
Trustpower – the business
Trustpower is a publicly-owned company, listed on the New Zealand Stock Exchange (NZX). Trustpower are a generator of electricity, and a retailer of energy and telecommunication services.
Trustpower has around 315 million shares on issue on the New Zealand Stock Exchange (NZX), and have two cornerstone shareholders; Infratil Limited and TECT, plus over 12,000 small parcel shareholders. TECT is a 26.8% shareholding in Trustpower. Infratil Limited has been a cornerstone shareholder since Trustpower’s formation in 1994 and hold a controlling share of 51.%
Trustpower generates a large amount of New Zealand’s electricity — powering numerous homes and businesses nationwide. Approximately 75-80% of the annual earnings come from the generation business.
Trustpowers' retail proposition is based on a multi product offering across electricity, gas and telecommunications. In 2018, Trustpower supplied around 270,000 electricity connections, 91,000 telecommunications connections, and 38,000 gas connections.. Trustpower’s customers represent homes and businesses from across New Zealand.