Commission begins scrutiny of Orion's proposed $1.51 billion investment

The Commission is seeking feedback on the proposed level of investment, the benefits it would deliver to consumers and the impact on electricity bills for the more than 235,000 homes and businesses connected to Orion's network.

Details of the assessment process, key timeframes, and the main issues under consideration are outlined in the process and issues paper published today, along with a notice confirming that Orion’s CPP application meets the relevant regulatory rules and can now be assessed. 

Associate Commissioner Nathan Strong said that while the CPP process allows an electricity lines company to seek approval for expenditure beyond standard regulatory settings, approval is not guaranteed.

“Our job is to rigorously test whether Orion's proposed expenditure is necessary, efficient, able to be delivered, and in the long-term interest of Canterbury consumers.”

Orion is seeking approval for approximately $932 million in capital expenditure and $578 million in operating expenditure, totalling $1.51 billion. According to its proposal, the spending is needed to address ageing infrastructure to maintain existing quality levels, support population growth and rising electricity demand, improve resilience to earthquakes and severe weather events, prepare the network for future energy needs and enhance efficiency and capability. 

To recover these costs, Orion is proposing increases to electricity prices from April 2027. The Commission estimates that, if approved in full, this would see a typical household’s monthly electricity bill increase by around $7.50 (in 2025-2026 dollars) in the first year of the CPP and around $3.50 on average (in 2025-2026 dollars) for each of the remaining four years of the CPP. 

"We know that every Canterbury household and business values a safe, reliable and resilient electricity network. Since Canterbury consumers ultimately pay for investments in the network, we need to ensure Orion demonstrates not only that the spending is needed, but that it represents good value for money and delivers benefits that matter to consumers." 

To ensure the proposed investment is sufficiently justified, the Commission’s assessment will focus on considering the appropriate levels of investment, how uncertain investment should be managed, the adequacy of Orion’s consumer consultation, how price impacts can be managed for consumers, appropriate levels of service quality and how best to monitor Orion’s progress and performance. 

The review of Orion’s proposed expenditure is further supported by an independent expert’s (verifier’s) assessment, as required under the CPP process. The verifier’s report helps the Commission better focus its assessment on areas that matter most for consumers. 
Mr Strong said, "We're particularly interested in consumers' views on the trade-offs as different people will value different outcomes differently, and understanding those perspectives is an important part of our decision-making.”

Feedback on Orion’s proposal and issues we have identified in the process and issues paper will help the Commission understand what matters most to Canterbury consumers. Submissions can be made until 5pm, 26 August 2026. The Commission also plans to hold targeted engagement with consumer groups for feedback on this paper. 

A draft decision will be released for stakeholder feedback in November, with a final decision to be made in March 2027. Consumer price increases would take effect from 1 April 2027. 

More information is available on our Orion's CPP 2027 webpage. 

Background

The Commerce Commission regulates New Zealand’s electricity lines businesses under Part 4 of the Commerce Act. As electricity lines businesses are monopolies and consumers have no choice but to connect to their networks, the Commission regulates the total amount of revenue they can earn from their consumers and the quality of service they must deliver. It does this by setting revenues and quality standards for local lines companies across New Zealand once every 5 years.

However, if a lines company like Orion needs to invest substantially more in its network, it can submit an investment plan (a CPP) to the Commission seeking approval for increased revenues to recover this investment.

The Commission has the power to approve, amend or decline aspects of the CPP proposal after assessing the supporting evidence for the proposed investment and considering consumer feedback.

The Commission does not regulate Orion’s owners, set electricity prices, or get involved in the day-to-day management of the company.

Orion submitted its CPP application to the Commerce Commission on 9 June 2026. Its application covers the five-year period from 1 April 2027 to 31 March 2032.