This opinion piece was published in the Newsroom on 29 April 2026.
View it here.
As demand for electricity grows, power bills are likely to rise. But switching away from petrol, and gas, could benefit many households.
We all know electricity prices are going up. But the power bill is only one part of what a household spends on energy.
When petrol, gas, vehicles and household appliances are included, the picture changes. The question is not just whether electricity costs more. It is whether households can reduce what they spend overall.
For many New Zealand households, the lowest-cost energy future is likely to be an all-electric one.
The wrong question
People often ask whether the shift to electric cars, electric heating, and more renewable power will push up electricity prices. In many cases, it will.
Building new generation, strengthening the grid, and meeting rising demand all cost money. But households do not only pay for electricity. They pay for the energy they use across their lives.
For a lot of people, that includes petrol for the car, gas for heating and cooking, electricity for everything else, and the capital cost of the appliances and vehicles that use that energy.
When those costs are counted together, the economics of electricity tend to shine.
Why electric can win
For one, it is simply far more efficient than fossil fuels. Nowhere is this clearer than transport. Electric vehicles convert energy into motion around three to four times more efficiently than petrol cars. Even today, the ongoing fuel and maintenance costs of an EV are far lower than those of a petrol or diesel car. They will be even more advantageous in the future.
The sticking point has been the upfront cost. EVs are still more expensive to buy, especially in the second-hand market. But modelling by the Climate Change Commission shows that over time, the higher purchase price of an EV is offset by lower running costs compared with petrol or diesel cars. Once that point is reached, households can be better off for each year they keep the vehicle.
Transport is where the biggest savings are likely to come from. For many households, reducing petrol use matters more than any single change inside the home.
Homes matter too
Replacing gas appliances with electric ones — heat pumps, induction cooktops and electric hot water — can also reduce costs over time, though the gains are more modest than with vehicles. Modern heat pumps can be three to four times more efficient at providing heat per unit of energy than gas boilers.
Gas prices are expected to rise faster than electricity prices, particularly as fewer households remain on the gas network and fixed costs are spread across a smaller customer base.
Rooftop solar can reduce costs further and give households more control over their energy use. But even without solar, the economics of going electric can still stack up.
For homeowners, going all-electric is likely to have another longer term benefit. Homes with sustainable technology like solar panels, EV chargers and modern electrical appliances will be more attractive to buyers and have a higher market value.
Reduced carbon emissions and improved air-quality will also be important factors for many families.
So why isn’t everyone switching?
If an electric household can be cheaper over time, why wouldn’t everyone rush to adopt it?
Because the barriers are not only about economics. They are about cashflow, timing and access.
Upfront costs matter. Many households cannot easily replace appliances or vehicles before the end of their useful lives. EV availability and choice are increasing as more brands, particularly Chinese brands, enter the market but the second-hand market is still developing. Renters may not be able to choose their heating, hot water, cooking or charging options. Lower-income households and people with low annual vehicle use may see fewer immediate benefits and be the last to access them.
What this means for policy
The shift from fossil fuels to electricity does not have to make households poorer, quite the opposite. It’s fair to assume the benefits will not arrive automatically, and they will not arrive evenly.
Power bills might rise but petrol and gas bills arealmost certain to go up. The question is not only whether households pay more for electricity. It is whether they can stop paying as much for petrol and gas.
Here at Electricity Networks Aotearoa, we think that means the focus of government policy needs to be wider than the monthly power bill. It needs to include access to efficient heating, fair pricing plans, support for renters, smarter use of the network, and practical ways for households to make changes when cars and appliances naturally come up for replacement.
The cheapest pathway will not look identical for every household. But the implication is clear: as New Zealand uses more electricity, the households that can reduce their reliance on petrol and gas will better placed.
We commissioned research on total household energy costs, available here.
Tracey Kai, Chief Executive of ENA