What are lines charges on a business bill, and why do they vary by region?

Every business power bill pays for two things: the electricity, and getting it to your meter. This guide covers the second part, with figures as at September 2026.

What are lines charges on a business power bill?

Lines charges are the delivery part of your power bill, separate from the cost of the electricity itself. The Commerce Commission says distribution and transmission make up just over 30% of the average power bill. A business bill can differ. Lines charges pay for two networks.

Transmission: the national grid

Transpower owns and runs the national grid: more than 11,000 kilometres of lines carrying bulk power at high voltage from power stations to local networks and some large industrial sites. Transpower puts transmission at around 8–9% of the average household bill; the Commerce Commission's 2024 estimate was about 10.5%.

Distribution: your local lines company

New Zealand has 29 local lines companies. They own the poles and wires that carry power from the grid, and from local generators, to homes and businesses. In 2023 they served 2.2 million connections and earned $2.5 billion in revenue, according to the Commerce Commission.

How lines charges reach your bill

Lines companies usually bill your retailer rather than you, though some very large sites contract with their network directly. The Electricity Authority says retailers "can then choose how and how much of these charges they pass on", and that lines charges are not usually itemised on bills.

For a business, that choice matters. Some contracts pass network charges through as a separate line at the lines company's published rates. Others fold them into one energy rate, which makes them harder to check. Our guide to reading a business power bill shows where to look.

Why is my lines company a monopoly, and who controls its prices?

Your lines company is a monopoly because, as the Commerce Commission puts it, running two or more sets of power lines side by side would be very expensive. You can change retailer, but not network: where your site connects decides it.

The Commission regulates these businesses under Part 4 of the Commerce Act. All 29 must publish data on prices, quality, finances and forecast spending. Beyond that, they split into two groups.

For the current five years, the Commission allowed the regulated lines companies $11.5 billion in revenue, 47% more in real terms than the previous period, with a first-year revenue rise averaging about 24%. Transpower, the only transmission business, was allowed $5.9 billion, with annual increases capped at 16% in each of the first two years and 5% after that.

Transpower's charges and local council rates are pass-through costs. Lines companies recover them on top of their capped revenue, so a grid price rise flows straight into lines charges.

A company that thinks the default path doesn't fit can apply for a customised one. Orion has applied for 1 April 2027 to 31 March 2032, and estimates a typical small business's distribution charge would average about $4 a month more than on the default path.

What makes up a business lines charge?

Most business lines tariffs combine a daily fixed charge with a per-kWh charge that is higher at peak times, and larger sites add capacity and demand charges measured in kVA. Your price category depends on connection size, and the cut-offs differ: Vector treats non-residential sites up to 69 kVA as "general", WEL Networks draws its line at 110 kVA, and Orion's major-customer category generally starts above 300 kVA.

Vector's prices exclude transmission, which it bills to retailers separately. WEL's and Orion's cover both distribution and transmission.

The Electricity Authority wants network prices to "better reflect the costs" each user places on the network. Networks are sized for their busiest half-hours, so those half-hours carry the price. Powerco, for example, introduced a demand charge for 200–299 kVA commercial sites in its eastern region (Tauranga and Thames Valley) from 1 April 2026. Our guide to demand charges explains how they're measured.

Why does the same usage cost different amounts in different regions?

The same kilowatt-hour costs more to deliver in some places because each lines company has different costs, a different number of customers to share them across, and its own price structure.

Customer density and distance

Rural networks run long lines to relatively few connections. Powerco says prices for its small commercial customers in lower-density areas are typically higher "because the lower network density and greater average system length means the costs of supply are allocated across fewer customers".

Each network's own investment and regulatory path

Revenue limits are set company by company. When the Commission set the current path, it estimated the first-year household increase at about $10 a month in some regions and about two and a half times that in others. Aurora Energy, which moved from a customised path to the default one on 1 April 2026, lifted its prices by an average of 21%.

Transmission costs differ by grid connection point

Transpower's charge to a lines company varies at each point where it connects to the grid. From 1 April 2026, the transmission component of Powerco's prices rose 21.2% in Thames Valley but 5.9% in Tauranga. Since 1 April 2023, the Electricity Authority's grid pricing rules have dropped the old regional peak-demand charge in favour of benefit-based and residual charges.

Different peak windows

Vector's time-of-use peaks for small businesses run 7–11am from June to August and 5–10pm from May to September. Orion aims to signal 80 to 100 hours of "control periods" on the coldest working-day mornings and evenings. The same operating pattern can land in a peak on one network and miss it on another.

Ownership

Some consumer-owned networks return money to their customers. WEL Networks has committed a discount of 9.36% of lines charges for 2026/27, capped at $248 excluding GST per connection.

How lines prices moved on 1 April 2026

Each company calculates these figures its own way, so read them as direction rather than a like-for-like league table. Our regional hubs show which network covers where.

Can a business reduce its lines charges?

You can't change your lines company, but you can change what it charges you for.

• Check your price category and capacity. Capacity charges apply every day to your connection size or nominated capacity, so an oversized setting costs money all year.
• Manage your peaks. At Orion's 1 April 2026 prices, every kilowatt a major customer cuts during winter control periods saves about $156 a year.
• Fix a poor power factor. Vector may apply power factor charges when a site falls below 0.95 lagging.
• Export solar at winter peaks. From 1 April 2026, networks including Vector and WEL pay small connections a rebate for power exported at winter peak times; on Vector's time-of-use categories it's 5.24c/kWh excluding GST. Whether it reaches you depends on your retailer.
• Know how your contract handles lines charges. Itemised at cost or bundled into one rate changes what you can compare.

For a second look at how your lines charges are passed through, start with our savings calculator or read what we do for business electricity.

Will lines charges keep rising?

Most likely, yes, until at least 2030. The Commerce Commission says these costs started rising in 2025 and points to three drivers: recent high inflation, interest rates much higher than when it last set them in 2019, and more spending to maintain networks and support growth.

For households, the Commission expected an average rise of about $5 a month in each year after the first. Transpower's cap drops to 5% a year from 1 April 2027. Lines companies publish next year's prices before each 1 April, so that's the date to review your contract. More on the other pressures: why business power bills are rising in 2026.