Serious Fraud Office
29/8/06                        DATELINE - AUCKLAND ENERGY CONSUMER TRUST ELECTIONS

Auckland Energy Consumer Trustee John Collinge was last week forced out of running for re-election as trustee on the Citizen N
Ratepayers Now (C&RN) ticket.  An insider reported that fellow trustee and C&RN candidate Karen Sherry was behind the ticket
dumping Collinge.  Trustees Warren Kyd and Mike Bruckowski, both up for re-election on the C&RN ticket, also backed the
dumping of Collinge.   Last election, the only trustee elected outside C&RN was Shale Chambers (Powerlynk). The AECT is
current 75.1% representative owner of Vector Energy.  

In the trust elections three years ago, Collinge was the highest vote getter.  However, soon after the election, divisions within the
party occurred.   Much of the division is blamed on friction over the partial privatisation of Vector in 2005, when 24.9% of the shares
were publicly floated.  Prior to the float, Trustees Chambers, Collinge and Bruckowski attempted to remove Vector Chair Michael
Stiassny from the board but Stiassny took Collinge to court in a successful move to keep Collinge from voting.  Sherry and Kyd then
were able to strike a deal to save Stiassny.  Stiassny's pay has doubled and in June 2006 Sherry and Chambers were appointed
as directors of Vector in a move that surprised the government, which had previously taken a position that concurrent acting as
trustee
and Vector director poses an inherent conflict of interest.  Vector, meanwhile, has suffered under greatly increased debt,
significantly rising expenses and falling share prices despite higher selling prices for electricity.

Collinge has vowed to run for re-election and this week claims to have started a new ticket, the primary platform of which is to
prevent trustees from engaging in such a conflict of interest.  Adding to the drama is the high profile of Michael Stiassny who is
intent on keeping his allies Sherry and Chambers on the Vector board.  Just last week, Stiassny declared war on the Commerce
Commission in response to the expressed intentions by the Commerce Commission to take over Vector pricing on the heels of
perennial over-charging by Vector.  Stiassny has decried the action as a "regulatory avalanche" and has warned that power
blackouts in Wellington and Auckland are a clear possibility if the Commerce Commission does not back down.

NEXT WEEK: Politics make strange bedfellows: the political marriage of Karen Sherry and Shale Chambers
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