Enabling investment and innovation
Transmission pricing methodology
The transmission pricing methodology is the method used to calculate transmission charges (the money that Transpower receives to fund the grid). It ensures transmission charges are allocated efficiently between transmission customers.
Overview
We are amending the transmission pricing methodology (TPM) to correct an issue with benefit-based charges for new transmission customers under the transmission pricing methodology’s simple method adjustment provision. This amendment is effective from 10 April 2024. Learn more.
We would like to thank all submitters who engaged in our latest two consultations. We are carefully considering all feedback to inform our next steps.
Timeline
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27 February - 26 March 2024
Consultation —Amendments to correct issues in the TPMView consultation -
27 February - 26 March 2024
Consultation —Further clarification on amending the TPMView consultation -
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9 - 23 January 2024
Consultation —Amendment to correct simple method adjustment issueView consultation -
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27 June - 19 July 2023
Consultation on issue 5 —Amendments to correct minor TPM issuesView consultation -
27 June 2023
Decision —To amend the Code to correct 9 issues
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1 April 2023
Implementation —New TPM commences
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Chair letter to Transpower - commencement of new TPM31 March 2023
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28 March 2023
Decision —Urgent Code amendment to correct formula errors in the new TPM
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22 November 2022
Decision —Code amendments to correct issues identified by stakeholders in the new TPM
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18 October - 31 October 2022
Consultation —Code amendments to correct issues in the new TPMView consultation -
19 July 2022
Decision —Amendment to the Code for notional embedding contracts
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21 June 2022
Decision —Code changes for the new TPM
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28 April - 18 May 2022
Consultation —Code amendments to support TPM implementationView consultation -
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12 April 2022
Correspondence —With Commerce Commission and Transpower
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28 February 2022
Correspondence —Electricity Authority and ComCom/Transpower on the TPM proposal
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11 November 2021
Q & A —Questions and answers from stakeholders on TPM topics
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8 October - 23 December 2021
Consultation —Proposed new transmission pricing methodologyView consultation -
8 October - 2 December 2021
Event — -
10 August 2021
Correspondence —Transpower's proposed new TPM
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22 March 2021
Correspondence —Sense Partners' issues and solutions of grid-connected batteries
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21 March 2021
Correspondence —Proposed TPM provisions for the residual charge to grid-connected batteries and similar storage
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15 March 2021
Correspondence —TPM transition - Electricity Authority, Transpower and NZ Steel
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14 July 2020
Correspondence —Notice of appeal against our decision to publish new TPM guidelines and development
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22 June 2020
Correspondence —Request to Transpower on their proposed TPM
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10 June 2020
Decision —TPM review and new TPM guidelines
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17 April 2020
Development —Cost-benefit analysis on TPM guidelines - view supporting information and analysis
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12 March 2020
Development —Information package
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27 September 2019
Correspondence —Communications on the 2019 TPM issues paper
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August 2019
Event —TPM proposal technical workshops
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26 April 2017
Announcment —New cost-benefit analysis for TPM guidelines to be released late 2017/early 2018
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28 August 2009
Report for the New Zealand Electricity Industry Steering Group —
Project background
In 2022, we adopted a new transmission pricing methodology (TPM) into the Code. This was a significant process which involved crucial input from key stakeholders, industry participants, Transpower and the Commerce Commission. The new TPM ensures that transmission pricing is fit for purpose in the transition to a low-emissions economy and that the grid is paid for by those who are expected to benefit from investment in it.
The new TPM will encourage more efficient use of the grid, and more efficient investment in transmission and generation assets. It will:
- reduce the cost of electricity at peak times when New Zealanders want to use it most
- ensure that those who set to benefit from areas of grid investment will pay for it
- lead to lower prices in the long-term for delivered electricity.
Our analysis suggests a central estimate of net benefit to New Zealanders of the new TPM of approximately $1.8 billion over the next 28 years.
Other projects in Enabling investment and innovation
View all projectsCode amendment omnibus
Consulting on amendments to the Electricity Industry Participation Code.
Improving visibility of generation investment
Improving information on investments in new generation connecting to the transmission and distribution network.
Distribution pricing
How to speed up distribution pricing reform to realise consumer benefits and facilitate an efficient low-emissions transition.