New proposed rules from the Commerce Commission and the Electricity Authority’s Competition Task Force aim to improve competition in New Zealand’s electricity market by restricting preferential treatment for retail arms of the four largest generator-retailers, known as gentailers.
Under the changes, companies like Contact, Genesis, Meridian, and Mercury will be required to offer hedge contracts to all market participants on the same terms they give to their retail businesses, promoting greater price and volume transparency.
Hedge contracts help stabilize prices, particularly during peak demand periods. Anna Kominik, chair of the Electricity Authority, called the proposal the biggest market shift in decades, aimed at fostering competition and securing a reliable energy supply. The changes would also allow smaller renewable energy producers to compete more effectively with large traditional companies.
Kominik stated that the Authority would intervene if unfair practices were identified and could introduce stricter measures if needed. Retailer Octopus Energy welcomed the reforms, arguing that they would improve competition, encourage investment in new generation, and lower electricity costs for consumers.
These proposed rules are seen as a significant step toward a more competitive and sustainable electricity market in New Zealand.
Related topics: