New Zealand homeowners are increasingly turning to solar power, spurred by rising electricity costs and bolstered by favorable financing options from major banks. Westpac has approved over 1,000 loans for solar and battery installations in the past two years, totaling NZ$30 million, while ASB has facilitated NZ$327 million in cumulative lending through its ‘Better Homes Top Up’ program in the last 12 months alone, with 4,500 customers participating. ANZ has provided over NZ$850 million to approximately 21,000 households.
The surge in interest reflects a broader shift towards energy independence, according to Mike Casey, CEO of Rewiring Aotearoa, an energy transition advocacy group. “This isn’t simply about switching from fossil fuels to electricity,” Casey stated. “It’s a significant change where New Zealanders are becoming producers and storers of their own energy, achieving ‘energy sovereignty’ rather than relying on energy companies.”
The typical cost of a solar system ranges from NZ$9,000 to NZ$15,000, with payback periods estimated at seven to eight years, particularly for households with high electricity consumption. Consumers can similarly sell excess energy back to the grid, though buyback rates vary between electricity companies, ranging from 8 to 23 cents per kilowatt-hour.
While solar panel installation is gaining traction, the upfront cost remains a significant barrier for many. Approximately half of those who do not plan to install solar cite cost as the primary reason. However, banks are responding with innovative financing solutions. Westpac offers its ‘Greater Choices’ loan option, providing up to NZ$50,000 interest-free for up to five years, having already disbursed NZ$270 million since 2020 for home and vehicle improvements. ANZ, BNZ and ASB also offer low-interest loans, while Kiwibank provides installation grants of up to NZ$2,000.
Despite the growing momentum, the affordability of battery storage remains a challenge. Casey argues that government support is crucial to accelerate battery adoption, citing their role in enhancing grid stability and reducing long-term household expenses. New Zealand’s rooftop solar penetration currently stands at 3-4%, significantly lower than Australia’s approximately 40%, which benefits from substantial government subsidies.
A key equity concern is the limited access to financing for those without mortgages. Renters, pensioners who have paid off their mortgages, and those without home equity are often excluded from these bank-backed schemes. Rewiring Aotearoa is developing a long-term, low-interest loan scheme linked to local government rates, tying the loan to the property rather than the individual and extending repayment terms to improve accessibility for lower-income households. Eight local governments and the Energy Efficiency and Conservation Authority (EECA) have already committed to the program.
A pilot program exploring solar access for renters is also under consideration, focusing on how to share the cost savings between landlords and tenants. Consumer NZ’s research journalist, Chris Schultz, estimates that solar systems reach a break-even point after 7-9 years, with faster returns for households with electric vehicles or high energy usage. Schultz predicts that a 5% solar adoption rate will mark a “tipping point,” where widespread adoption becomes self-reinforcing.
