Network Pricing

We set prices to ensure that we can cover our costs, operate a sustainable, reliable and efficient electricity network, as well as comply with the regulated revenue cap that the Commerce Commission has set for us. 

Once prices are set, the amount customers pay depends on the service quantity. Chargeable quantities are generally capacity based (how big your electricity connection is) and volume based (how much electricity you use). Our focus is developing price structures that are equitable across the various customer types we have in our region (general supplies, irrigation etc) and using chargeable quantities that reflect our costs helps achieve this.

While our total revenue is regulated by the Commerce Commission, the structure of our pricing is monitored by the Electricity Authority against a set of pricing principles that it has established.  Our published “Pricing Methodology” document shows how we categorise power connections, assign costs and shared costs, how we structure prices, and how we align with the pricing principles.  You can download a copy of this from our disclose page at https://www.eanetworks.co.nz/disclosures/.

We are also required to re-focus our pricing when directed by the Government (such as changes to the Low-User Fixed Charges).  

Our electricity delivery charges include the costs we pass on from Transpower, who maintain the national grid.  

The Commerce Commission has set a new regulated price cap for the next five years, allowing for a 25% increase in revenue. This adjustment accounts for inflation that was higher than expected when the previous five-year regulated limits were set, and also a return to more normal interest rates over the past regulatory period.  Additionally, Transpower's charges to us have increased by 18%.

To maintain our network and essential services, we need to adjust our operating budgets accordingly. As a result, we are increasing our prices by an average of 20% across all customers to reflect these changes and ensure we continue to meet customer demands.

Fixed and capacity charges are a set amount charged on a daily basis that reflects the capacity throughout our network that is reserved and maintained for your use, regardless of how frequently (or infrequently) you use that capacity.  This is all about the capacity of your connection and your peak demand for electricity, measured in kW (or kWh per hour).  

Volume charges are what you pay for the amount of electricity that you use on a daily basis. Volume charges are a good way to recover costs for shared assets, as those that use more pay more, and those that use less pay less. This is all about how “much” electricity you use, measured in kWh. 

At EA Networks, we build the network close to you to meet your peak demand, and we build our upstream network to meet the combined peak demand of all customers. This means our asset costs are largely driven by capacity needs: your peak demand, and your contribution to network peak demands.   

Yes.  As we move away from volume pricing, we are working to enhance our pricing structures to provide more choice for customers to “right size” their supply capacity and reduce costs. 

•  Small residential customers can select a half size supply (that has 30 amp fusing) and move to the smaller general supply category, 
•  We’ve created additional categories for commercial supplies to better reflect different sizes.  Customers can move between the categories by requesting an upgrade or downgrade, 
•  Industrial customers can select a booked capacity that meets their current and future needs, and downgrades will reduce the amount we charge. 

All customers of EA Networks are entitled to receive a consumer discount. This is calculated in March each year and we pay the discount through electricity retailers directly to power accounts. To get the discount you need to have an active power account on our network on 28/29 February. If you move property during the year, we’ll make sure that the discount from your time at the old property is transferred over to your new property. Switching retailers will not affect your discount - we'll track down who you are with and make sure the discount gets credited to your power account.

Discounts are a great way for us to ensure our charges stay low.  We could lower our prices instead, but we don’t think that would be reflected in retail electricity prices.  Retailers are required to pass on our discounts and can’t pocket the money. 

You can find out more about our consumer discount here.  

The Government has made the decision to phase out low user fixed charges over a 5-year period from 2022 – 2027.  

The goal of Government is to create a fairer and more equitable system. Low fixed charges meant we had to apply high volume prices which:

• are hard on households that have high energy needs, perhaps because they have large families, might be living in poorly insulated renal accommodation, and can’t afford energy efficient appliances or solar panels,
• discourages customers from using power for things like electric vehicles and heating,
• encourages customers to avoid using our service through expensive forms of generation.

Shifting the balance away from volume prices is fairer, and will help our community reduce their impact on our environment.

MBIE have some great information about the changes here ( www.mbie.govt.nz/phasing-out-low-fixed-charge-tariff-regulations)