If you live in South East Queensland, New South Wales, Victoria, South Australia or ACT, you have the option of being able to choose from different electricity providers. More selection means more competition. Many retailers are happy to offer competitive rates, discounts, and incentives to get you to switch providers.
Keep in mind that what might look like the cheapest electricity rate, or the best discount, may not be what’s right for you. There are many factors to take into consideration when picking an energy provider.
Every state in Australia is different when it comes to power. Rising energy prices are due to a mix of factors1. According to research conducted by the Australian Energy Market Commission (AEMC)2, there are two main factors which have recently affected energy prices in Australia. The first is a lack of investment in things such as infrastructure. They claim this is as a result of uncertainty created by policy pushes to reduce emissions. The second is increases in gas prices, which they claim is due to higher demand for gas in export markets2.
Another factor is government regulation which discourages competition. However, in the last 10 years many state governments have been deregulating the energy industry, creating competition and allowing for discounts on electricity.
In the ACT, electricity prices are regulated, so the government sets the rates you pay. This means that all electricity providers will have similar rates. Still, there are several companies currently operating in the residential electricity market in Canberra, so it’s still a good idea to compare offers.
NSW has had a deregulated energy industry since July 2014, with many suppliers battling it out for business. It’s easy to find great discounts in NSW that may make your electricity much cheaper.
Residents of Victoria are in the same boat, as deregulation of the industry occurred in 2009. Competition is fierce, with 22 electricity providers. The high demand in Victoria has caused prices to rise, but by comparing deals regularly, consumers can still find cheap electricity. The AEMC also points to the closing of the Hazelwood plant, which supplied about 20% of Victoria’s energy2.
South Australians pay some of the highest electricity bills in the country3. The industry was deregulated in 2013 and there’s competition among energy suppliers in SA - many offer discounts during your first 12 months. If you live in SA, it’s important to compare against other plans every once in a while to make the most of the discounts offered on cheap electricity.
In South-East Queensland, retail electricity prices were deregulated on 1 July 2016, which includes Brisbane and the Gold Coast. If you live in this area, you can now choose your provider.
It’s not just one competitive rate that makes electricity cheaper or more expensive. There are many variables that affect the price. When you’re ready to start comparing your plan, start by taking into account whether there’ll be an exit fee for leaving your current provider.
This information may be on your bill, or you can contact your provider and ask. Then start working through this list of other variables that might make your electricity cheap or expensive.
Tariffs refer to both supply and usage charges. A supply charge is the fixed price per day4 to provide electricity to your home. On the other hand, a usage charge is a variable price that changes4 depending on how much electricity you use. When looking at costs from a provider, take note of how both charges stack up against the competition. If you use less electricity then you may prefer a competitive supply rate, while a household using a lot of power might do better with a competitive usage rate.
Rates are electricity usage charges, measured in cents per kilowatt hour (c/kWh). These can be charged in several different ways.
One option is to look out for fixed and variable rate plans. Most plans are offered in variable rates, but some providers offer a fixed rate over a set period of time. It’s impossible to say how variable rates may rise and fall, but if you look at energy rates over time, you may feel that a fixed rate plan will offer cheaper electricity in the long run.
Another option to look into are single and time of day rates. Some energy plans are charged on a single rate, no matter the time. However, other plans charge different prices for electricity used during the day, at night and on weekends. These may also be referred to as peak, shoulder or off-peak periods.
Thoroughly review these options, as your usage habits might determine what the right electricity is for you.
The more competition exists in your state, the more discounts and rebates you might find energy suppliers offer. ‘Market’ contracts are designed by energy retailers and include discounts, rebates and incentives. On the other hand and you have standing offers, which generally don’t come with these same discounts or rebates as a market contracts.
Look for a special introductory offer to new customers that you may be eligible for. This could be for 12 or 24 months. If you take advantage of an offer like this to get cheap electricity, make sure that you go back and compare again when that offer is over. This way you’re always taking advantage of the best rates available.
Check if you could save money by meeting certain conditions, such as paying on time, via direct debit or receiving communications by email. There are usually conditions for receiving discounts, and if you don’t meet them, you may end up paying more.
Energy suppliers may also offer other incentives, like rebates on your first bill, gift cards, or air mile incentives. These offers may determine which energy plan is best for you, rather than looking for the cheapest.
Take note if there are paper bill charges, as this will affect your overall price. You may also want to take into account other billing options to determine what’s best for you. For example, being billed monthly, bi-monthly, or quarterly may determine which plan suits your needs best in terms of budgeting.
Be vigilant of fees and charges that may affect your bill over time, such as those for establishing a connection, paying bills late, moving house or leaving the contract early.
The cheapest electricity plan for you will depend on personal circumstances. This includes where you live, how you want to pay, and your energy usage patterns. There’s only one way to find out exactly how much you could save, and that’s to compare.
We’re here to do the hard work for you. Search plans we offer from our range of electricity providers in your area, and make sure you’re on an electricity plan that suits you. We can even arrange to switch providers on your behalf.
Call us today on 13 19 20 to compare electricity plans from our range of providers* today!