New Zealanders Get More Choices For How We Use, Buy And Sell Electricity - And Lower Our Power Bills

New Zealanders will have more choices for how they use, buy and sell electricity - so they can lower their power bills - because of new market rules confirmed today by the Electricity Authority Te Mana Hiko (the Authority).

The Authority is changing the electricity market rules to give New Zealanders more control over their power use and costs. The changes, led by the Energy Competition Task Force (Task Force), will benefit all electricity consumers by putting downward pressure on power prices over time.

Electricity Authority Chair and Task Force member Anna Kominik says the changes are about helping New Zealanders to have more choices for how they consume and supply power than ever before - and rewarding choices that benefit the system and keep power prices down for everyone.

"In the very near future, we’ll all be making more active choices about when and how we consume and supply energy. The decisions we’re announcing today reset the market rules to encourage choices that contribute to our electricity system for the benefit of all power consumers.

"Consumers who engage as active players in the power market will become important contributors to a more sustainable and dynamic electricity system, and we will all benefit from this through lower power costs," says Kominik.

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The new rules mean large retailers (those with five per cent or more market share) will have to offer a pricing plan that gives consumers cheaper rates for off-peak electricity. The changes will also reward those households who supply power to the network from small-scale generation systems (such as rooftop solar and batteries) at times when it’s most needed to keep the country powered up.

Commerce Commission Chair and Task Force member, Dr John Small, says the changes will support New Zealanders making decisions about investing in rooftop solar systems with batteries (or other small-scale generation systems) and offer us new ways to lower our power bills.

"Currently, access to time-varying pricing plans for power use and supply is very limited. The decisions announced today will help drive retail innovation and ensure most New Zealanders have access to these plans within a year so they can benefit from cheaper off-peak power. They also strengthen the case for rooftop solar systems with batteries, by rewarding people with these systems for the savings they provide the network when selling power into the system at peak times."

The new rules are part of changes the Electricity Authority and the Energy Competition Task Force are making to increase the supply, affordability and options for consumers.

The Authority will engage with large retailers and distributors over the coming months to provide further guidance on the changes it is making and how they might interact with other related policy work.

The Authority’s decision papers are now available on our website.

Energy Competition Task Force Package Two decisions webinar

A webinar is being held where Electricity Authority Te Mana Hiko and the Commerce Commission Te Komihana Tauhokohoko Task Force representatives will talk through the decisions and take questions.

What: Energy Competition Task Force Package Two webinar

When: 9.30am-10am, Wednesday 16 July

Register: Microsoft Virtual Events Powered by Teams

Notes:

The new requirement for large retailers to offer ‘time-of-use’ plans will only apply if they haven’t made material progress in offering these pricing plans by 30 June 2026.

The Authority will closely monitor retailers’ progress and act swiftly to enforce the new rules where required.

The Authority decided rebates for supplying power to the network when it is needed should reflect the broader, long-term benefits provided

In response to feedback from submitters, the Authority changed its approach to calculating the rebates (negative charges) paid when consumers supply power to the network.

Rather than reflecting the specific value consumers provide by helping to relieve congestion at specific locations on the network, the rebates will instead reflect the broader, long-term benefits provided. This change in approach is important and recognises that, given the tools available now, distribution pricing is better suited to sending broad signals than managing specific network constraints.

In addition, this change will mean that the amount paid when consumers supply power will also vary, and that these rebates will fairly reflect the true value of the power they provide to the network. This will encourage people to supply power to the network when it’s most needed.

The Authority did not consider rebates that mirror peak consumption charges appropriate because:

• requiring distributors to apply rebates that mirror peak consumption charges could cause additional costs to the network (which we all pay for through lines costs).
• these costs mean the average value of supply is likely to be lower than the average value of reduced demand on the network.
• supply at peak times, which will most likely come from battery storage, is also likely to be more responsive to price than demand and could lead to ‘battery dumping’ when stored energy is released all at once, creating issues for network management.

About the Energy Competition Task Force

The Energy Competition Task Force was established by the Commerce Commission Te Komihana Tauhokohoko and Electricity Authority Te Mana Hiko in August 2024 to investigate ways to improve the performance of the electricity market.

The Task Force is considering eight initiatives that will encourage more and faster investment in new electricity generation, boost competition, enable homes, businesses and industrials to better manage their own electricity use and costs, and put downward pressure on prices.

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