The Energy Competition Taskforce released two consultation documents today and while there are plenty of positives and signs of a fairer system for customers, there is still some bias against investments made by homes and farms towards investments made by networks and energy companies. 

Rewiring Aotearoa believes this is a positive and refreshing focus on lowering future energy bills, but more could be done to make sure the proposals are followed through on.

“The Electricity Authority has historically been slanted towards the big end of town and Rewiring Aotearoa’s goal is to get the innovation the customer needs for a level playing field and lower bills. These are the most customer-friendly changes we’ve seen the Authority propose, but they are not big or brave enough to match the speed with which the technology is evolving or that our energy transition demands,” says Mike Casey, Rewiring Aotearoa CEO. 

“Overall, we’re giving the EA a pat on the back because they are proposing a lot of good stuff for the customer, all of which we have been arguing loudly for, so they have listened and it is clear they have recognised the system is changing from one-way - electricity flowing from big power stations, down the poles and wires into homes, farms and businesses - to a smarter, two-way system where customers play a role and are rewarded more fairly.”

At this early stage - and this is just the first draft of the plan - Casey says it’s just a gentle pat because he thinks the Taskforce needs to go much further and help set New Zealand up for a future where customer generation and storage play a much bigger role in the system.

“Unfortunately, while the playing field looks like it has been levelled slightly, it’s still uneven and while we commend the focus on customers and see this as definite progress, there is still a bias against customers and a bit of bowing down to the big players who don’t want to change.” 

As Rewiring Aotearoa’s Electric Homes research has shown, New Zealand has already reached the electrification tipping point, so going electric and running your home and car with a combination of grid electricity and solar and batteries is already a good economic decision for most homes (and likely the best thing they can do to reduce emissions).

“These proposed changes to the system won’t change the inevitability of this shift. Adoption rates for solar, batteries and EVs are already growing because of the economics, but these changes will improve the economics slightly and should speed up adoption rates further.” 

Among the changes proposed are that all retailers will have to offer time of use plans. Incentivising customers to shift their usage to different times of the day is an important economic signal. This should also help reduce peak problems and help lower power prices for everyone over the long term. 

Rewiring’s work on symmetrical export tariffs was also referenced. 

“It isn’t exactly what we’re asking for, but these changes mean that when those households with solar or batteries export energy, it should be worth more, perhaps double or more what they currently get for export from some large gentailers. This is not a subsidy at all; it’s paying what the energy is worth to the system, which for years we have been let down on by some retailers and gentailers.” 

Using as much of your own electricity in more efficient electric machines or shifting demand to off-peak times is still the best way to save money on your energy bills, but these changes mean customers who can modify their behavior or optimise their consumption will benefit further by competing on a more level playing field. 

Casey says some of the requirements are quite weak and have been left in the hands of these energy companies to implement. 

“We have 25 years of evidence that if you ask these EDBs and power companies to do something out of the goodness of their hearts, they are unlikely to do it and bills will continue to go up. They don’t want to change if they don’t have to, so they need to be compelled to change for the good of customers and the country as a whole. We’re disappointed the regulator is not going further to lower costs for all consumers. There is no technical reason bills for New Zealanders should be going up: solar is the cheapest it’s ever been, and we can now run higher utilisation networks with batteries.” 

Casey says Rewiring Aotearoa will be the first to praise the energy companies that take the initiative. 

“We would love to see retailers and networks step out in front of this, deploy solar buyback rates that are similar to wholesale, and, if you're a network, deploy symmetrical peak export tariffs. These are both in the best interests of New Zealanders and of the long term efficiency of the electricity system as a whole. The pressure is only going to build from here to treat customers more fairly when they contribute to the system. The time is now to show that you as an energy company are offering a fair deal.” 

Energy underwrites the economy and we need more cheap electricity to grow, which is what the Government is focused on. This needs to be a priority. High electricity prices are also hurting our most vulnerable communities and they stand to benefit most from these cost-saving technologies. 

“This work and the necessary code changes could set New Zealand on a course to create the world's cheapest renewable electricity and become a world leader in electrification. We've led the world before in this regard - the southern hemisphere's first public electric street lighting in Reefton, the world’s first electric home near Tauranga, the first wet steam geothermal power station, world's first all-electric cherry orchard - and we could do it again. These proposals are a good start, but we need to be braver and go bigger. We look forward to talking with the taskforce and submitting our ideas on how these proposals can be improved.”

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• For more information or to arrange an interview with Rewiring Aotearoa CEO Mike Casey, contact Ben Fahy at ben@rewiring.nz or 021 245 4894. Images of Mike Casey here. 

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