Published on the 11/12/2025 | Written by Heather Wright

Digital transformation on wheels…

New Zealand’s Ministry of Transport has issued an RFI for technology providers to deliver a new electronic road user charges (RUC) system, marking the largest overhaul of road charging in New Zealand’s history.

The revamp will see the end of petrol taxes, replaced instead by RUC for all and a digital platform capable of managing vehicle data, billing and compliance. Currently, road user charges only apply to vehicles not powered wholly by petrol, and vehicles exceeding more than 3.5 tonnes. Under the eRUCs 3.6 million light petrol vehicles will move to RUCs based on distance travelled and vehicle weight.

“New services could include very simple solutions, through to full electronic solutions enabling automated purchase.”

While the current RUC system relies on manual paperwork and paper licenses, the RFI released by the Ministry of Transport is focused on paying for RUC electronically .

Transport minister Chris Bishop says modernising RUC – in what will be the largest operational and mandated RUC system in the world according to the New Zealand IoT Alliance – will allow for more technology options, including systems already built into modern vehicles.

“Road users will be able to opt in to using this technology to make it easier for them to pay RUC, but they will also have the option of manual alternatives,” Bishop says.

The platform is expected to rely heavily on IoT and telematics to track vehicle usage and automate charging, and is expected to integrate connected devices for accurate distance measurement and data reporting. Bishop says he wants the system to be as easy as ‘paying your power bill or streaming service’.

The Ministry of Transport RFI is looking at the readiness of third parties to offer services for light vehicles already in the RUC system by 2027 and all vehicles in future, along with the range of services that may become available and any barriers or areas where additional government support might be needed to support third-party providers.

“New services could include very simple solutions that enable people to keep track of their odometer readings and receive purchase reminders, through to full electronic solutions enabling automated purchase,” Bishop says.

The Land Transport (Revenue) Amendment Bill currently before parliament will pave the way for new technology and open up the RUC market to wider competition, Bishop says.

“We’d like to see a mix of businesses get involved and be part of this opportunity,” he says.

That includes tech companies offering software, telematic and electronic systems to manage RUC, companies that could combine payment for RUC with other services, such as banks, vehicle insurers and utilities and companies that could sell RUC over the counter, such as fuel companies and supermarkets.

James Smith, general manager of policy and advocacy for National Road Carriers, is also keen to see eRUCs in place to ease administrative burdens for businesses and make things fairer. He says the rollout of electronic systems will enable operators to track charges in real time, reduce administrative burdens and gain better insight into vehicle costs. It’s also a opportunity to ‘close the funding gap’ created by lower fuel consumption and the shift to electric vehicles, he says.

“This is a chance to modernise New Zealand’s road funding system in a way that is equitable, transparent and future-ready.”

A number of eRUC offerings are already in place, with several approved providers for heavy vehicle fleets, including Teletrac Navman, Argus Tracking and Eroad.

Argus Tracking, a kiwi telematics company, which has dubbed the RUC law change ‘a major turning point in compliance and cost management’, provides digital displays to replace the traditional paper RUC licenses for fleet vehicles, automatically updating RUC purchases.

NZX-listed Eroad also provides an automated, New Zealand Transport Authority-approved RUC offering which automatically records distance travelled and locations and calculates off-road distance travelled. The RUC licenses can be bought online as needed.

Startup Bonnet also has a solution enabling RUC tracking. It bills its solution as a system designed for both ends of the spectrum – from the small tradie with one or two utes to the fleet manager handling hundreds of vehicles and including an odometer entry offering, where users are required to input odometer readings manually once a month, as well as GPS-powered automated offerings.

Bishop notes that data privacy will be a key element for any new systems, with any tech solutions required to comply with the Road User Charges Act which includes strong privacy safeguards and strict limits on what information can be accessed.

While the government has not disclosed the total value of the project, its national scope and long-term impact suggests it will be one of the most substantial tech initiatives in the transport sector in recent years.