New Zealand’s electricity market is about to change in a very real, household-level way. From September, consumers will be able to share their electricity usage data more easily, compare plans faster, and switch providers with far less friction, as the Government rolls out what it’s calling “open electricity.”
The idea borrows heavily from open banking. The goal is simple. Give people control over their own data, then let competition do the rest.
What “open electricity” actually means for households
At the core of the reform is a legal designation of the retail electricity sector under the Customer and Product Data Act.
That designation requires electricity retailers to make certain data available, securely and with customer permission. Consumption history. Pricing information. Product details. All of it.
For consumers, this means they can choose to share their electricity data with trusted third parties, such as comparison websites or energy management services. Instead of guessing which plan fits best, tools can calculate it properly, using real usage patterns.
The Government says this will remove a major barrier that’s been quietly frustrating people for years.
Right now, most households are effectively shopping blind.
Why ministers say the current system doesn’t work
Energy Minister Simon Watts and Commerce and Consumer Affairs Minister Scott Simpson didn’t mince words when announcing the change.
They pointed to the sheer scale of complexity in the market. More than 15,000 residential power plans are currently available across the country. That’s not choice. That’s overload.
For most people, comparing plans means hours of clicking, confusing terminology, and fine print that never quite lines up. Many simply give up and stay put, even if they’re overpaying.
Watts and Simpson argue that open electricity flips that dynamic. Instead of consumers chasing information, information comes to them in a usable form.
Basically, the market starts working the way it was always supposed to.
Who stands to benefit, and how much
The Government estimates that around two million households and about 165,000 small business customers will benefit directly from the change.
That’s a big chunk of the country.
And there’s already evidence that switching matters. Recent energy savings campaigns showed that consumers who changed power plans saved an average of $358 a year.
That’s not pocket change. Especially now.
With cost-of-living pressures still biting, an extra few hundred dollars staying in a household budget can make a noticeable difference. Groceries. School costs. Rent increases. You know the drill.
The ministers framed it as a practical reform, not a theoretical one. Transparency leads to switching. Switching leads to pressure on prices.
At least, that’s the bet.
How data sharing is supposed to work in practice
From September, electricity companies will be required to share certain customer data when a consumer gives consent. The emphasis, according to officials, is on secure and controlled access.
Consumers won’t be forced to share anything. Participation is voluntary.
But if they choose to opt in, they can allow third parties to analyse their usage patterns. Peak times. Seasonal spikes. Day versus night consumption. All the stuff that actually determines which plan is cheapest.
This also applies to pricing data. Retailers will need to make plan details more accessible, which should reduce the number of “looks cheap but isn’t” offers.
The Government says this mirrors the open banking framework introduced late last year, which has already started reshaping how people compare financial products.
Electricity is next.
Why this could change how people use energy
There’s a second layer to the reform that goes beyond switching providers.
With clearer access to consumption data, households can make more informed decisions about how and when they use electricity. That includes shifting usage away from peak times, where network costs are highest.
Watts and Simpson say this could lead to system-wide savings. Lower peak demand means less strain on infrastructure. Less strain can mean lower costs over time.
For consumers, the benefits are more personal.
Open electricity data could help answer questions many households are already asking. Is solar worth it for me? Would an electric vehicle raise my power bill too much? Am I using more electricity than similar homes?
Right now, those answers are fuzzy at best.
With open data, they become measurable.
Small businesses and a level playing field
While most of the attention is on households, small businesses are also in scope.
For cafés, retailers, and workshops, electricity costs are often a significant overhead. Yet many small operators stick with legacy plans because switching feels risky or confusing.
Open electricity is meant to change that.
By allowing easier comparison based on actual usage, small businesses should be able to find plans that better match their operating hours and load profiles.
That matters, especially for businesses already squeezed by rents, wages, and supply costs.
More transparency could mean more viable options.
Competition, but with guardrails
The Government is careful to stress that this isn’t a free-for-all.
Data sharing will be governed by standards under the Act. Consent rules apply. Security requirements apply. Not every app or website gets access just by asking.
Trust is central to the model.
Officials argue that open banking faced similar concerns at first, yet adoption has grown as consumers became more comfortable with the controls.
Electricity, they say, will follow a similar path.
Still, some consumer advocates will be watching closely. Any large-scale data reform brings questions about misuse, mis-selling, and clarity of consent.
Those details will matter just as much as the headline promise.
When changes will become visible
According to the ministers, consumers should begin to see changes from September.
That doesn’t mean the market transforms overnight. Tools will roll out gradually. Retailers will adapt at different speeds. Awareness will take time.
But the direction is set.
By formally designating electricity under the Act, the Government has locked in a structural shift. Retailers will need to compete harder. Comparison services will become more accurate. Consumers will, in theory, gain leverage.
Whether all of that translates into sustained lower bills remains to be seen.
But for the first time in a long while, the system is being redesigned around the person paying the bill.
