Today, the Electricity Authority published a report on the 2025 electricity allocation factor (EAF) on its
website.
This is the second year the Electricity Authority has provided a report on EAF. Determining the annual EAF is an independent statutory function of the Electricity Authority, set out in the Climate Change Response Act 2002.
The EAF factor measures the change in electricity prices because of emissions pricing. It is one component used by the Ministry for the Environment to calculate how many NZ ETS units (NZUs) industrial allocation recipients get.
Industrial allocation recognises that New Zealand Emissions Trading Scheme (NZ ETS) costs might affect the international competitiveness of some businesses if they had to pay for all their emissions. Approximately eighty firms receive emission units (NZUs) from the Government each year.
Around a third of the annual industrial allocation is set using the EAF.