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Enabling investment and innovation

Distribution connection pricing reform

We are improving connection pricing methodologies so they are more efficient and consistent across distributors.

  • Distribution
  • Code

    • Overview

    Until recently, there have been few rules about how distributors develop and structure their pricing for new or upgraded connections to their networks. This has led to wide variation in connection charges across the country and in some places, created barriers to getting connected.

    We want to develop rules that improve connection pricing methodologies, so they are more efficient, transparent and consistent across distributors.

    If we don’t, we expect to see even higher up-front costs, more inefficiencies, less investment, fewer developments, slower electrification, slower decarbonisation – and everyone losing out in the long run. Reforming connection pricing methodologies takes time due to its complexity and deep interactions with distributors’ business operations and network management.

    A phased approach allows us to address some known issues more quickly and prioritise the issues that are most important.

    Following consultation, we implemented the first set of new rules that came into effect from 1 April 2026. These ‘fast-track' measures make quick and significant progress towards efficient pricing, while laying the foundation for further regulatory change.

    Further new rules were announced in July 2026 to stop inefficiently high up-front connection charges from rising further than needed, giving connection applicants greater certainty on what they can expect to pay. These rules also followed consultation and are intended to be an interim measure while we consider a more enduring and comprehensive solution.

    This is being explored in an issues paper that seeks feedback on a range of issues that could be considered in the next stage of reform. Submissions on the issues paper have been published and we now seek cross-submissions by 5pm, 17 September 2026.

    We also sought feedback on draft guidance that, once finalised, will help distributors apply the new rules. We are refining it in response to feedback to ensure it is workable while achieving the policy intent.

    Our work to clarify and introduce obligations on distributors so it’s clear when they must offer and maintain connections is ongoing. Following consultation in late 2025, we decided to take a gradual approach – starting with monitoring the supply of connections – to allow time for the new rules for connection charges to be established.

    Alongside this work, our Network connections project is making distribution networks more efficient, lowering costs for consumers and improving the security and resilience of the electricity supply.

    To keep up to date with these two work programmes, sign up to our Network Connections Brief newsletter. You can unsubscribe at any time. You can also contact the team at connection.feedback@ea.govt.nz with ‘connection pricing’ in the subject line.

    Timeline

    Past activity

    Resources

    Information for those wanting to connect to networks: new pricing rules for 2026-27

    Information for distributors: new connection pricing rules for 2026-27

    Our FAQs webpage has more information about the rules we’ve put in place.

    Or get in touch with the team at connection.feedback@ea.govt.nz with ‘connection pricing’ in the subject.

    Project background

    As part of New Zealand’s electrification, more energy users – such as industrial plants, big businesses, new data centres, EV charging stations and new housing developments – are seeking new or larger connections directly to the distribution network.

    Getting the rules around connection pricing methodologies right is one essential building block to support the growth of businesses and critical infrastructure, and efficient electrification of the economy.

    We consulted on distribution pricing in July 2023. In May 2024, we outlined our intentions to develop a proposed Code amendment for connection pricing in our ‘Distribution Pricing Reform: Next Steps’ paper.

    In June 2024, we began the multi-stage ‘Distribution connection pricing reform’ project and announced a technical group of industry representatives to assist with testing the workability of our proposed Code amendments and their implementation.

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