Overview of the electricity industry

Broadly speaking, the industry can be broken down into four main components – generation, transmission, distribution and retail.

The Electricity Network's Association is the membership organisation for the businesses that operate in distribution part of the sector - the 27 lines companies.

overview diagram mediumGeneration

Electricity in New Zealand is generated by five major companies, with the government a major shareholder in the three of those companies. Nearly 80 percent of New Zealand’s electricity comes from renewable sources.

 

Transmission
State-owned enterprise Transpower owns and operates New Zealand’s national electricity transmission system, which supplies electricity to lines companies using high capacity, high voltage transmission lines.

 

Distribution
Twenty-seven lines companies (all members of the Electricity Network Association) distribute electricity throughout New Zealand. Lines companies connect to the national grid and sell electricity to retailers who, in turn, provide a service to consumers. For more information on New Zealand’s extensive network of lines companies, see our map.

 

Retail
Electricity retailers are the companies that sell electricity to you. Retailers buy electricity at wholesale (spot and contract) prices from generating companies and transmission or distribution services from lines companies.


How much revenue lines companies can earn is regulated by the Commerce Commission. A recent report on the profitability of lines companies shows that most were within one percent of the limit set by the Commission.