New Zealand households are bracing for a power price hike of about 5% this year, following a 12% increase last year largely driven by higher lines charges, Consumer NZ said in a report on Wednesday.

Power bills are rising due to higher line charges, the fixed cost of delivering electricity to homes that remains the same no matter how much power is used, said Paul Fuge, Powerswitch manager.

Consumer NZ advises households to start budgeting for higher power bills from the end of April, with line charges expected to rise by an average of NZ$5 per month through to 2029.

Power bills are rising even though record rainfall and overflowing hydro lakes should be driving electricity prices down, per the report.

Consumers' research found that last winter, one in five New Zealanders went to bed early to stay warm, a quarter went without heating, and nearly one in five cut back on food or essentials to pay power bills.

"Based on our price predictions for 2026, we think the situation will only get worse," Fuge added.