News & insights

CEPA was engaged by the New Zealand Electricity Authority to prepare a report on the regulation of electricity distribution connection charges, which are one-off or upfront charges that are typically triggered by the creation of a new connection – or the upgrade of an existing connection – to a distribution network.

Connection charges have become an increasingly contentious issue in the New Zealand electricity distribution sector as there is increasing demand for new connections and increasing reliance by some electricity distribution businesses on upfront charges. There is a concern that problems in the current regulatory framework may lead to a lack of transparency, overcharging, or overservicing of new connections. It is feared that this will deter new connection requests and slow the process of electrification.

CEPA’s report assesses the policy proposals put forward by the Authority. Specifically, it explores the problems that have emerged with the current regulatory framework, assesses the extent to which the Authority’s proposals address those problems and carries out a qualitative assessment of costs and benefits of those proposals.

For the reasons set out in the report, CEPA believes that the Authority’s proposals will result in a material improvement in the regulation of connection charges in New Zealand.