The government plans to strengthen the Electricity Authority, increasing penalties and enforcement powers in a bid to ease pressure on household power bills and improve competition in the electricity market.
Energy Minister Simon Watts said legislation would be amended to give the regulator greater authority to act against rule-breaking power companies, arguing the current system does not go far enough to protect consumers.
“Kiwis are feeling the pressure of high power bills,” Watts said, adding that the government is moving quickly to ensure electricity companies “play by the rules”.
Under the proposed changes to the Electricity Industry Act, maximum penalties for serious breaches would rise from $2 million to as much as $10 million, or three times the commercial gain, or up to 10 per cent of a company’s turnover. The Electricity Authority would also gain the power to issue instant infringement fines of up to $2,000 for minor but repeated breaches.
The reforms would also improve the authority’s ability to update market rules and monitor behaviour across the sector, with the government saying this will strengthen competition and better protect consumers.
Higher penalties, however, are not expected to take effect until 2027, while the new infringement system would begin in 2026. The enforcement tools would align the authority more closely with those already available to the Commerce Commission.
Watts said the changes would ensure “real consequences” for companies that attempt to distort the market or take advantage of customers, and would help restore confidence that households and businesses are not being overcharged.
The reforms come as the government continues broader work to address high electricity prices, manage dry-year risks, and ensure long-term energy security. Since announcing its Energy Package in October, the government has begun the first stage of procuring an LNG facility to improve security of supply, assessed new generation projects through the Fast Track Approvals process, and started developing a new regulatory framework aimed at preventing dry-year shortages that can drive up prices.
This article was originally published by the Daily Telegraph New Zealand.
