Energy levies
This page sets out the 2023/24 levy rates for the petroleum or engine fuel monitoring levy, and the gas safety, monitoring, and energy efficiency levy. It also explains how the levies are calculated and how the levy was broadened after consultation.
On this page
Part of the levies fund EECA
The Energy Efficiency and Conservation Authority (EECA) is the Crown entity that works to encourage, promote, and support energy efficiency, energy conservation, and the use of renewable sources of energy. Some of EECA’s activities are funded by the PEFM levy and the GSMEE levy, in addition to a levy on electricity industry participants.
Rates for the petroleum or engine fuel monitoring (PEFM) and gas safety, monitoring, and energy efficiency (GSMEE) levies
| PEFM and GSMEE Levy Rates | ||
| 2023/24 | 2024/25 | |
| PEFM | 0.72 cents per litre | 0.69 cents per litre |
| GSMEE | 6.0 cents per gigajoule | 5.3 cents per gigajoule |
Calculations for the 2024/25 PEFM and GSMEE levy rates are set out below:
| 2023/24 levy rates for gazettal | PEFML | Gas levy |
| Regulation 6 | Regulation 10 | |
| Estimated cost (cents) | 1,350,000,000 | 170,000,000 |
| Supplementary estimates amount | 0 | 0 |
| Adjustment amount (cents) | -16,718,500 | 53,340,000 |
| Sum of estimated costs, supplementary costs and adjustment amount (a+b+c) | 1,333,281,500 | 223,240,000 |
| Estimated volume (litres and GJ respectively) | 6,909,620,300 | 66,971,800 |
| Variable EECA cost (cents) | 0.19 | 3.3 |
| Regulation 5 | Regulation 9 | |
| per litre | per gigajoule | |
| Existing rate (cents) | 0.50 | 2.0 |
| Variable EECA cost (cents) | 0.19 | 3.3 |
| Levy rate | 0.69 | 5.3 |
The 2024/25 levy rates have been notified in the Gazette(external link)
How the levy rates are calculated
The PEFM and GSMEE levy rates are provided for in the Energy (Fuels, Levies, and References) Act 1989 (the Act). Sections 23 and 24 of the Act require the levy rates to be calculated in accordance with the Energy (Petrol, Engine Fuel, and Gas) Levy Regulations 2017 (the Regulations).
The Regulations provide for the levy rate to be calculated each year to account for the variations in EECA’s levy funding.
In June 2019, Cabinet agreed to increase the non-EECA component of the PEFM levy from 0.2 cents per litre to 0.5 cents per litre to meet the increasing cost of New Zealand's International Energy Programme Treaty obligations. As a result, regulation 5 was amended to replace “0.2 cents per litre” with “0.5 cents per litre”.
For the 2019/20 levy rates and onwards, Regulations 5 and 9 require the Chief Executive of MBIE to calculate, before the start of a levy period, the PEFM and the GSMEE levy rates with the following formulae:
- PEFM = 0.5 cents + the variable EECA costs in cents
- GSMEE = 2 cents + the variable EECA costs in cents
Regulations 6 and 10 of the Regulations set out how the “variable EECA costs” are to be calculated. Regulations 7 and 11 require our Chief Executive to publish the levy rates and calculations for each levy period in the Gazette and on this website.
The Government decided to broaden the levy
Before 1 July 2017, approximately half of EECA’s funding came from an electricity levy and it could only spend it on electricity efficiency activities.
In May 2016 we consulted on expanding the purpose of one or more of the existing levies on electricity, transport fuels and gas.
While electricity efficiency is still important, the transport and industrial sectors are areas where the most impact can be made on improving New Zealand’s energy productivity and reducing carbon emissions.
The intention of the proposed levy changes was to allow EECA to undertake more activities where the gain for New Zealand is the greatest.
Read more about the levy consultation on the consultations page.