NZ Moves to Rein in Power Prices with Tougher Electricity Market Enforcement

A stronger regulator is expected to improve investor confidence while discouraging behaviour that artificially inflates prices during periods of tight supply.

The New Zealand Government is significantly strengthening oversight of the electricity market, granting the Electricity Authority new enforcement powers designed to curb anti-competitive behaviour, protect consumers, and restore confidence in a system under pressure from high power prices.

Energy Minister Simon Watts announced today that Cabinet has agreed to amend the Electricity Industry Act, equipping the regulator with tougher penalties, faster enforcement tools, and greater rule-making flexibility — bringing it into line with modern competition and market-regulation standards.

“Kiwis are feeling the pressure of high power bills,” Watts said. “We’re moving quickly to ensure the electricity market works for consumers, not against them, by giving the Electricity Authority real teeth.”

Sharper penalties, faster enforcement

Under the reforms, the Authority will gain a materially expanded enforcement toolkit:

• Maximum penalties for serious rule breaches will increase from $2 million to up to $10 million, or three times the commercial gain, or 10 percent of a company’s turnover.

• A new instant infringement regime will allow fines of up to $2,000 for minor but repeated breaches, enabling faster, lower-friction enforcement.

• Enhanced powers to update market rules and improve monitoring, strengthening competition and consumer protection.

The infringement system will come into force in 2026, with higher penalties applying from 2027. The enforcement framework mirrors powers already used by the Commerce Commission, signalling a shift toward more proactive market governance.

“These changes mean power companies will face real consequences if they distort the market or take advantage of customers,” Watts said.

Why this matters for energy markets and innovation

For energy-sector and infrastructure journalists, the reforms mark a decisive move toward data-driven regulation, faster compliance cycles, and stronger incentives for market transparency — critical in a system increasingly shaped by renewable generation, complex trading behaviour, and climate-driven supply risks.

A stronger regulator is expected to improve investor confidence while discouraging behaviour that artificially inflates prices during periods of tight supply.

“A more effective Electricity Authority will help keep prices fair, encourage competition, and give families and businesses confidence they’re not being overcharged,” Watts said.

Part of a broader energy system reset

The regulatory overhaul comes amid wider reforms aimed at improving affordability, resilience, and long-term supply security.

Since announcing its Energy Package in October, the Government has:

• Begun the first stage of procurement for an LNG facility to improve security of supply.

• Fast-tracked approvals for new energy generation projects, unlocking investment and increasing capacity.

• Started designing a new regulatory framework to prevent dry-year shortages that drive price spikes.

“These steps are about ensuring New Zealand has affordable, abundant, and reliable energy,” Watts said.

New leadership for a stronger regulator

The Government has also confirmed new appointments to the Electricity Authority Board, reinforcing governance capability as enforcement powers expand:

• Erik Westergaard, Deputy Chair

• Anthony Baldwin

• Benjamin Bolot

• Murray Parrish

“These appointments bring deep experience in energy markets and industry reform,” Watts said. “They will help ensure the Authority is equipped to deliver better outcomes for consumers.”

Outgoing Chair Anna Kominik and members Lana Stockman and Dr Cristiano Marantes were acknowledged for their service.

Call to action: industry on notice

With stronger penalties, faster enforcement, and enhanced oversight on the way, electricity retailers and generators are being put on clear notice to review compliance frameworks, market conduct, and pricing behaviour ahead of the new regime.

For consumers and businesses, the Government says the direction is clear: a tougher regulator, clearer rules, and an electricity system designed to work in the public interest.

“Our focus is simple,” Watts said. “Making sure the energy system works for New Zealand households, businesses, and industry.”