Timaru District Council is proposing that Timaru District Holdings Limited sell its shareholding in Alpine Energy to help provide better financial returns for the community.

TDHL, which owns the shares on behalf of the Council, will reinvest the proceeds into a ring-fenced, diversified fund to help fund an increased dividend to be paid back to council each year.

The proposal comes as councils across New Zealand face growing pressure from rising costs, ageing infrastructure, and limits on rates increases. Timaru District Council says the change would improve the group’s financial position by an average of $7 million a year while protecting the proceeds of the sale in the long-term

Alpine Energy is planning to invest nearly $400 million in its network over the coming decade, which means dividend returns are forecast to remain very low.

Mayor Nigel Bowen said that while the current Alpine Energy investment remains valuable, it is not generating the level of cash return needed to help reduce pressure on rates and support essential services.

“Our proposal is about protecting community wealth and significantly improving financial returns,” he said.

“While the proposal involves selling a long-held community asset, the real question is whether this $130 million investment is capable of delivering sufficient returns for the people of this district down the track.

“Alpine will continue to deliver the essential services as it always has due to the regulatory environment it operates in, whether we own shares in it or not won’t change this.

“Our responsibility is to make sure community wealth is protected, carefully managed, and working as hard as it can for both current and future ratepayers.”

The proposal will not affect the regulation of electricity prices, which are set independently, and would not affect the community ownership of the Line Trust, which remains at the discretion of the consumers.

Any reinvested proceeds would be ring-fenced, independently managed, and used for long-term community benefit rather than day-to-day spending.

Councillors will consider the proposal at the 30 June council meeting, and the community is encouraged to provide feedback to the proposal at Timaru.govt.nz/alpine