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

This means connection applicants are only charged for the most cost-effective solution that meets safety and technical standards.

For example, a connection applicant cannot be charged for an underground cabling if connecting with overhead lines would meet relevant safety and technical standards at lower cost.

A more expensive type of connection can be chosen – either by you or the lines company – and whoever asked for that option must pay for the extra costs.

The lines company and connection applicant may agree not to apply the above rules or for an alternative method of allocating costs.

A connection applicant can also ask the lines company if there is a lower cost ‘flexible’ scheme. This is where a connection applicant agrees to reduce its electricity use in a way that helps the lines company more easily manage the load on its network. For example, a connection applicant may agree to reduce their electricity use in peak times. The lines company must provide a flexible scheme if it is reasonable for it to do so.

See clause 6B.4 of the Code.

These rules do not apply to connection applicants that use the ‘large connection contracts’ mechanism specified by the Commerce Commission. Refer to (6B.3.(3)(b).

The cost of extending the network is often relatively high, while the extra costs to add additional connections in the future are relatively low. This means whoever connects first pays a disproportionate amount for the extension even though future connections also benefit from it.

Each lines company must publish its pioneer scheme policy, which outlines their approach to creating and administering pioneer schemes.

Under certain circumstances, lines companies must create a pioneer scheme to make sure the first person to connect gets a rebate if other users connect and use the extension the first person, (the pioneer) paid for.

Without a ‘pioneer scheme’, network growth stalls if no one wants to be the ‘pioneer’ who pays the costs of the initial extension. This can discourage connection applicants from connecting at some locations and can disadvantage other network users because over time, there would be fewer people contributing to the shared costs of the whole network.

Under the new rules, lines companies collect contributions from those who connect to the network extension later and these are refunded to the ‘pioneer’.

The contribution each new connection pays must reflect the distance along the network extension it is, and the capacity it uses. The lines company can deduct an administration fee from the rebate due to the pioneer.

The lines company must not collect contributions if it is less than $1,000 (in December 2025 dollars CPI adjusted), and after a reasonable administration fee has been deducted – if there is one.

Other requirements are:

• A scheme is only required where a new connection triggers a network extension of more than $50,000 (in December 2025 dollars, CPI adjusted), although a lines company may choose a lower threshold.
• The scheme only applies to new connections from 1 April 2026.
• Pioneer schemes must operate for at least 7 years and payments will reduce over time as assets age.
• The original ‘pioneer’ can opt out of the scheme.
• Lines companies are not required to create pioneer schemes for real estate developments.

See clauses 6B.6 to 6B.9 of the Code.

These rules do not apply to connection applicants that use the ‘large connection contracts’ mechanism specified by the Commerce Commission. Refer to (6B.3.(3)(b).

A connection charge reconciliation is an extra document connection applicants can ask for. It doesn’t replace the lines company’s quote – it explains its pricing in a standardised way.

Connection applicants can ask for a connection charge reconciliation, even if they’re dealing with a contractor instead of directly with their lines company.

The connection charge reconciliation helps connection applicants:

• see what costs make up their connection price
• compare different connection options more easily and understand the differences
• see how prices differ between regions if they deal with more than one lines company
• have better, more informed discussions with their lines company about the connection costs.

See our ‘Guide to connection charge reconciliation’ for more information about this requirement and what it means for connection applicants.

The requirements are set out in clauses 6B.10 to 6B.11 of the Code.

From 1 April 2026, the existing dispute resolution processes that apply to connections of distributed generation were extended to include all connection applicants.

Lines companies still have flexibility in how they set their connection charges, but must comply with the new rules as they come into effect.

If you think a lines company has not complied with these requirements, our ‘Report a breach’ webpage has information about what you can do.

The dispute resolution processes are set out in clauses 6B.12 and 6B.13 of the Code.

Data indicates a small number of lines companies may have been requiring newly connecting customers to pay more than their share by increasing up-front connection charges. In some instances, charges are forecast to increase further.

The new framework will prevent high up-front connection charges from rising further and in some cases bring them down to more efficient levels.

Under the new framework, lines companies’ connection pricing methodologies should be consistent with the principle that new and upgraded connections:

• aren’t subsidised by existing connections on the network
• make a comparable contribution to shared network costs as similar existing connections on the network.

The Authority will undertake an initial scanning of connection pricing methodologies. If required, it will undertake a closer examination and decide whether to direct the lines company to adjust its connection pricing methodologies for new connections going forward.

This is an interim solution that will expire in 2030. We are considering developing a more enduring and comprehensive solution as part of an issues paper scheduled for release on 13 July 2026.

Read chapter 3 in the decision paper for more information about this new framework. The rules will be contained in clauses 6B.11A to 6B.11C of the Code.

‘Capacity costs’ help lines companies recover the costs of building shared (or upstream) network infrastructure. These assets provide the capacity to ensure the network can manage demand at peak times.

If a lines company chooses to allocate capacity costs, they must do so using their published rates. The effect of this is to recover costs as capacity is consumed, rather than when it is built.

Lines companies must set and publish capacity costs for:

• each part of their network tier (eg, sub-transmission line, zone substation, high voltage feeder, distribution substation, low voltage mains)
• each geographic area (zones)

Capacity costs must be published for the current year and the next four years.

This gives connection applicants greater visibility of the prices they pay for connecting.

New connections are a key driver of additional network infrastructure, so some lines companies already include these costs in their connection charges. Some lines companies do not charge ‘capacity costs’.

Under the new rules, any ‘capacity costs’ charged to a connection applicant must reflect the capacity used and where on the network that capacity is required.

Making ‘capacity costs’ more cost-reflective helps prevent other people already on the network having to pay for costs they didn’t create – reducing cross-subsidies and addressing timing issues more efficiently.

Recovering the cost of shared network infrastructure progressively as people join the network (and use up its capacity), helps spread costs over all network users who benefit.

Over time, improving how capacity costs are allocated should ensure efficient new connections are not deterred, connections are right sized and support ongoing network investment that benefits everyone.

Other requirements are:

• Prior to 1 April 2027, any lines company that charges ‘capacity costs’ must include these when providing connection charge reconciliations.
• The published rates should include separate rates for each of the five tiers on the network.
• The rates must represent the average costs of adding network capacity at each tier.
• Lines companies may use specific rates where the cost of adding capacity for a particular connection network is much higher (more than 150%) or much lower (less than 80%) than the average cost for that tier.

The rules are set out in clause 6B.5 of the Code.

These rules do not apply to connection applicants that use the ‘large connection contracts’ mechanism specified by the Commerce Commission. Refer to (6B.3.(3)(b).