Network pricing reforms should benefit all consumers
07 April 2025
Kiwi families and small business will benefit from lower electricity prices if the Electricity Authority gets its distribution pricing reforms right, says Entrust Chair Denise Lee.
“Entrust wants the reforms to happen and to have all customers benefitting and fairly sharing from the benefits of small scale generation such as household solar,” she says.
The rapid changes in technology including uptake of solar panels and batteries by homeowners and businesses across the country creates challenges which the Electricity Authority is addressing with its distribution pricing reforms.
The electricity generated from solar panel and battery installations benefits the country as a whole as it helps to reduce or delay the investment in building new large scale power stations and can delay the need for expensive network upgrades.
The challenge is to ensure households with solar are appropriately compensated for electricity they inject back into the grid, but that the compensation is neither too small nor too generous says Ms Lee.
“Safeguards are needed to ensure rebates paid to consumers feeding electricity back to the grid are appropriate, and not at the expense of less well-off consumers.
“Care is needed to ensure that solar rebates align with the Authority's consumer protection objectives and does not disadvantage low income and vulnerable households. The potential impact on different consumer groups is an area that warrants more in-depth attention by the Authority.
“Households that cannot afford solar PV and batteries could be particularly harmed if the compensation paid for injecting electricity back to the grid is excessive. No consumer group should be given preferential treatment.
“Entrust wants to ensure that electricity is supplied in an efficient and affordable way to all consumers. This means that all consumers, regardless of whether they have solar and batteries or not are treated fairly,” she says.
As of the end of December 2024, New Zealand has 573 MW of grid-connected photovoltaic (PV) solar power installed, of which 199 MW (35%) was installed in the last 12 months. (Source Electricity Authority)