Entrust is a private trust established in 1993. It acts in the interests of its beneficiaries, over 346,000 households and businesses in Auckland, Manukau, northern Papakura and eastern Franklin.
Most trusts exist for the same reason: to make sure their assets are protected and managed in a way that delivers maximum benefit for their beneficiaries, both in the short term and the long term.
Generally speaking, Entrust does four things:
- We receive dividends from our shareholding in Vector and distribute them to our beneficiaries
- We manage our majority ownership of Vector on your behalf.
- We deal with government bodies on regulatory issues
- We provide strategic input to Vector at board level
Managing our majority ownership of Vector
Entrust’s key asset is a 75.1% shareholding in Vector. As the major shareholder in Vector and through our two Trustee directors on the Vector board, we make sure we fulfil our responsibilities to beneficiaries by maintaining proper oversight of Vector’s operations.
Entrust was formed as part of reforms to the electricity industry in 1993.
Entrust was originally called the Auckland Energy Consumer Trust or AECT. In 2016 we changed our name to Entrust, a simple combination of energy and trust.
Our history began in 1993 when, as part of the electricity industry reforms, the Auckland Electric Power Board became a company called Mercury Energy.
A trust (called Auckland Energy Consumer Trust at that time) was set up to own the company and ensure that the power lines remained in control of the electricity consumers in the area that used to be served by the Auckland Electric Power Board.
Around the country 29 other energy trusts were set up to own their former power boards too.
In 1998, the government made more changes to the industry, including splitting the energy sector into lines companies and retailers. This resulted in the retail business of Mercury Energy being sold to Mighty River Power (a state owned enterprise) and the lines business being retained and named Vector.
In 2002, Vector acquired UnitedNetworks, the lines company operating on the North Shore and in Waitakere.
We retained 100% ownership of Vector until 2005, when we agreed to Vector’s initial public offering, or share float, of 24.9% of the shares in Vector so it could raise money to buy gas company NGC Holdings. (Vector has since gone on to invest in other businesses too.) The result of this share float, and a subsequent buy back of shares in 2009, is that the AECT holds the majority of Vector’s shares, currently 75.1%. This ensures that Entrust has a controlling interest in Vector.
To find out more about the history of the AEPB (and electricity in Auckland in general), see the book “Sign of Service: A history of the Auckland Electric Power Board” by Jennifer King, available from the Auckland Public Library.
How the industry is structured
Keeping the power in Aucklanders’ hands since 1922
Entrust has only had guardianship of Vector on behalf of the Auckland community since 1993. However, the idea of community ownership of Auckland’s power network goes back much further than that. The Auckland Electric Power Board was set up in 1922 as a consumer-owned utility. (Before that, electricity distribution was looked after by local councils.) Even back then, the AEPB’s founders understood the value and importance of electricity supply to Aucklanders, and this model of guardianship of electricity distribution for the good of the entire community continues today with Entrust.
In 2006 the New Zealand Institute of Economic Research compared our ownership of Vector with four alternatives (local council ownership, management by a professional trust company, handing shares over to beneficiaries, local councils and the Auckland Regional Council, and transfer of shares to a new regional infrastructure body).
On every measure, including efficiency and what was best for energy consumers in the Entrust area, the NZIER concluded that the current setup is the best option.