Wellington has historically benefited from a low-cost and highly reliable electricity network, and we want to preserve what consumers value about it.

Many of the assets that have served Wellington well for decades are ageing and will increasingly need to be renewed. At the same time, severe weather, changing technology and the shift away from fossil fuels are changing what the network may need to accommodate. In addition, there are more homes, businesses and transport in our region that are relying on electricity.

It is important that we know where those pressure points are and will be in the future, because renewing and upgrading our assets can provide us with opportunities to increase network capacity. Knowing this will help us better prepare for greater electrification across the region.

Simply, Wellington’s electricity network is situated at an important juncture. The pressures on the network are converging, and we have been planning carefully to resolve them. We know what needs to be managed, and we know that additional investment is needed to keep the network running safely and reliably.

Doing nothing is not a realistic option. Without additional investment, reliability is expected to decline as equipment ages and failures become more common. This will be increasing the risk of more frequent power interruptions across the network. Waiting longer would also make future replacement costs higher and create more disruption for customers.

We need to make all attempts to renew the network in an affordable way so people can keep the lights on, homes warm and meals cooked. That is why we have planned to deliver the work over a longer sequence: prioritising the highest-impact investment first, while safely phasing lower-priority work into later stages.

What we are planning for the future of our network

Now we are at that first stage of a longer-term programme to renew and strengthen Wellington's electricity network. Over the next five years, we want to build the people, systems and technology needed to safely and efficiently deliver a larger programme of network renewal in the future, while also replacing the highest-priority ageing equipment and investing in network capacity where it is most needed. Strengthening these foundations now will help us deliver work more effectively, reduce risks and disruptions for customers, and better prepare the network for future demand.

This is the first phase of a 15-year plan to modernise the network while managing costs for customers. Rather than trying to do everything at once, we've prioritised the work that will have the greatest impact on network safety, reliability and future demand. Lower-priority projects have been pushed into later stages so we can keep the programme affordable and achievable. The proposal will be independently verified and then assessed by the Commerce Commission before it determines WELL's customised price-quality path.

Specifically, our plan focuses on replacing some of the network's highest-risk cables and power transformers, addressing critical safety and reliability issues, and building new network capacity where it is needed and will benefit the most people.

We also need to strengthen the foundations that support this work by investing in our people, systems and technology. Building this capability will help us deliver future work at a pace that keeps costs and disruption manageable, improves reliability and customer service, and creates lasting value for the region. It will also help us communicate better with customers, especially during storm events, by giving us better data and analysis to make faster, smarter decisions, work more efficiently and support more jobs across the programme. Finally, by presenting a clear and long-term programme of work, we aim to create more employment opportunities and build enduring capability in the region. Over time, these stronger foundations will also help us set prices that better reflect the true cost of delivering the network and provide clearer cost transparency for customers.

The work we have done so far

One of the biggest challenges has been balancing reliability and affordability. We could spend more and move faster. We could also spend less and do less work. Instead, we've developed a programme that seeks to address the most urgent needs first while limiting the impact on customer bills and keeping the work at a scale we can realistically deliver and build upon for the future.

Simply we are trying to build the best path forward that will prioritise renewing the assets that will make the most positive difference while creating the lowest cost increase. To do that, we need the right foundations of people, systems and technology that will help us do that efficiently and intelligently. And, rather than doing everything at once, we will focus on building capability first, measure our progress, and only move to the next stage when we're confident the foundations are in place. This builds on the approach we already take: where it is safe to do so, we extend the life of existing equipment and defer lower-priority replacements to help keep costs down for customers.

Earlier options we explored would have required an increase of about $34 a month, but we do not believe it is realistic or fair to deliver such a large programme over five years when many households are already under pressure and the resources needed to deliver the work are still being developed. Instead, we are looking at a longer timeframe that does the most important work first, accepts a small relaxation in reliability in the short term, and reduces the expected bill impact to around $10 to $20 a month.

Ultimately, if we can start these plans as soon as possible, we believe the plans get the right balance. This would mean an increase in electricity bills by about $12-14 a month for households in the Wellington region. We can invest more or maybe less, but we know waiting longer will mean more cost and more interruptions to our daily lives. 

This proposal is about preparing Wellington for the future

Wellington's network currently has a high level of reliability. For the past 15 years, it has consistently ranked among New Zealand's top three networks for lowest lines charges and lowest rates of outages.

Our proposal aims to keep the network safe and reliable, but reliability may decline temporarily during the first phase (CPP1) as we balance the pace of renewals against what is safe, affordable and realistically deliverable. However, the proposed investment is expected to slow that decline and reduce longer-term risks compared with taking no additional action. 

We are at a turning point. The electricity network was originally built for a different world before electric vehicles, rooftop solar, battery storage and the shift away from fossil fuels became part of everyday life. Today, electricity is expected to play a much bigger role in how we live, work and travel. Our challenge is to maintain an affordable and reliable network while preparing for these changes in a way that is practical, affordable and sustainable over the long term. However this also presents opportunities like planning for a more automated network that can support decarbonisation and manage new patterns of energy use, such as solar, batteries and electric vehicles connecting in different places and at different times 

The network we rely on today exists because previous generations planned ahead and invested for the future they expected to see. We now face a different future, one with changing technology, growing demand for electricity and greater expectations for resilience and service. However, our goal and responsibility is the same, we need to make sensible investments now so we can build steadily for that future, giving Wellington a network that remains safe, reliable and affordable for decades to come.

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