Research by the New Zealand Initiative shows that we are third highest in the world when it comes to levels of electricity from renewable resources, sitting at 83%.
The government is aiming for that number to be 100 percent by 2035.
But according to researchers, increasing from 95 to 100 percent would mean an extra $800 million added to our annual cost of electricity, delay the transition away from fossil fuels and increase carbon emissions.
NZ Initiative research fellow Matt Burgess told Mike Hosking the last 5 percent is where things start to get expensive.
"The market is on track to get to 95 percent without any type of policy or subsidies. We don't subsidise electricity at all in this country, which makes us unique."
Burgess says the government doesn't need to be in the business of picking winners with policies.
"The right way to go about this is to use price. We have an emissions trading scheme that needs to be tightened up and to be fair to the government, they are doing that.
"Putting a price on carbon makes the polluters pay, which is the best way to find the least cost and to reduce emissions."
Renewables already account for 83% of New Zealand's electricity, and on current trends will generate up to 97% of the country's electricity in 2035 without any help from policy changes.