How to Handle an Unexpectedly High Electricity Bill

Content OageHero Image CRO Overlay Image

Written by

|

Edited by

Updated 05/06/2024
What changed?
Updated information on VDO and DMO, and rebates
|
Fact checked
Our aim is to help you make better informed decisions. That’s why iSelect’s content is produced in accordance with our fact-checking and editorial guidelines.
|

Find out more about how we make money.

View our Privacy Policy.

Written by

Liv Steigrad

Updated 05/06/2024

What changed?

Updated information on VDO and DMO, and rebates
Our aim is to help you make better informed decisions. That’s why iSelect’s content is produced in accordance with our fact-checking and editorial guidelines.

Find out more about how we make money.

View our Privacy Policy.

Compare Electricity & Gas Plans

Save time and effort by comparing a range of energy plans with iSelect

Why is my electricity bill so high?
What if my electricity bill is wrong?
What else can I do to reduce my electricity bill?
Am I eligible for an energy relief fund?
Where can I compare Electricity Providers?

Why is my electricity bill so high?

Received a monster electricity bill and wondering why? If you haven’t made any drastic changes to your lifestyle or the way you use your electricity at home, there are other factors that could have contributed to your larger-than-expected bill. Let’s take a look. 

Seasonal changes 

We reckon you should be comfy when relaxing at home so that air-con might have to do a few all-nighters in the middle of January. Whether it’s a scorching summer or a particularly icy winter, a new season often means different levels of heating or cooling are required. This can translate to different amounts of energy use from more recent bills.  

New or faulty appliances 

New washing machine or dishwasher? Upgraded to a much bigger TV? New appliances can contribute to a larger electricity bill, especially if they’re not energy efficient or having a new one could mean a sudden increase in usage. But if you haven’t bought any new appliances recently, your existing appliances could be the culprit. If they’re faulty in some way, they might be using up more electricity than they should.  

Unpaid charges from previous bills 

If your bill seems wildly different to the norm, it could simply mean that unpaid charges from a previous bill were carried over to your current one. If this is the case, it should say so on your current bill. You can also look through your previous bills and payment records to double-check this.

Incorrectly estimated charges 

If your meter wasn’t able to be read (due to overgrowth, construction or an angry doggie), your Energy Provider might send you an estimated bill. If they do, it legally must have the letter ‘e’ or the word ‘estimated’ next to the usage charge.2Energy and Water Ombudsman Victoria – Estimated bills 
 
Estimated bills are often above or below your actual usage. If your Energy Provider estimates too little, they’ll send you a back-bill or add the gap to your next one.3Energy and Water Ombudsman Victoria – Backbilling, refunds and lost payments If they charge you too much, a credit should be applied to your account.4As above.  

If you have an estimated bill, you may be able to submit your own meter reading (known as a ‘self-read’) by taking a clear photo of your meter. If your self-read disputes the bill, your Energy Provider must adjust the bill.5Energy Made Easy – Received an energy bill you think is wrong? Contact your Energy Provider to forward a self-read. 

Rising rates 

If nothing else in your house has changed or your energy habits are the same, the good news is it might not be your fault. The bad news is rising energy rates could be behind your electricity bill going up. These rates reflect rising costs elsewhere in the electricity industry, including wholesale prices and network prices,6Australian Energy Regulator – Default market offer prices 2023–24: Final determination, p3–4 ,7Essential Services Commission – 2023–24 Victorian Default Offer: Final Decision Factsheet, p3–4 with the additional increases flowing on to consumers. At large, these rate rises are happening across the country, with different states and territories experiencing their own changes depending on how their energy market is regulated.  

For example, the 2024–25 Default Market Offer (DMO) is based on wholesale costs starting to lower while network costs have continued to increase. As a result, prices have continued to shift around, with some households able to expect small reductions in their bills while others may have small increases.8Australian Energy Regulator – Final decision on electricity prices to protect consumers While the DMO only affects standing offer contracts, your Electricity Provider may still have changed or raised rates on market offers in accordance with those different wholesale and network prices.  

In a similar vein, the 2024–25 Victorian Default Offer (VDO) saw a small decrease overall which can be contributed in part due to forecasting lower wholesale electricity costs for the financial year (these make up about 30% of the overall VDO for a flat tariff bill).9Essential Services Commission – P12 However, network costs rose, preventing the VDO from reducing more noticeably.

What if my electricity bill is wrong?

If your bill is wrong, or you think it might be, the first step is to double-check the details. Your bill should have a meter number on it; this is what your Energy Provider uses to link your energy usage to your account. So, if you’ve never looked before, go on a bit of a Carmen Sandiego hunt around your house, find your meter and check the meter number. If the number doesn’t match what’s on your bill, take a photo and contact your Energy Provider. 

Alternatively, your bill may have the correct meter number but not the right meter reading. This may be because your meter was inaccessible, and your Energy Provider had to estimate your electricity usage. As we covered above, you’ll know this is the case if your bill has the letter ‘e’ or the word ‘estimated’ next to the usage charge. All you need to do then is forward a photograph of your energy meter with the reading clearly visible for your Energy Provider to amend the bill as appropriate. 

Remember, if you’ve contacted your Energy Provider regarding an incorrect bill and you’re not happy with how they resolved it, you can escalate the issue by reaching out to your state or territory’s energy ombudsman service.

What else can I do to reduce my electricity bill?

Unfortunately, you can’t do much about electricity price rises. But there are other small changes you can make at home that can add up, resulting in a difference to your bill. 

  • Turn appliances off at the wall 
    Some appliances use up electricity even when you’re not actively using them. Getting in the habit of turning things off at the wall can have a big long-term impact on your bill.
  • Switch to LED lights 
    LED lights use significantly less electricity, reducing your overall bill. If you can, switch to LED lights. If you’re renting and you can’t change the light bulbs, you could also get some LED standing or table lamps to use instead of the property’s overhead lights. Plus, they’re so relaxing to sit next to while enjoying a glass of wine.
  • Compare providers with iSelect
    While the grass may not always be greener on the other side, it’s worth taking a peek over the fence to check. With iSelect, you can compare a range of electricity providers to see if a cheaper deal is an option for you.
  • Get your fridge temperatures right 
    Making sure your fridge and freezer are at the right settings and are sealed properly can help them run more efficiently. The ideal temperature for your fridge is 3°C and for your freezer it is -18°C.10Sustainability Victoria – Reduce fridge and freezer costs at home
  • Try to use electricity in off-peak times 
    If you have an electricity meter capable of measuring intervals, you may be able to get an Electricity Plan that uses time-of-use tariffs. This means you can plan your electricity use for off-peak times when your electricity rates are cheaper than peak times.11Energy Made Easy – Which type of tariff is right for you? While you might not be able to avoid doing some things at peak times, like cooking dinner, try to run your larger appliances, like your washing machine and dishwasher overnight to reduce your overall energy costs.12Government of South Australia – Time of use tariffs Your specific peak and off-peak periods will depend on your Energy Provider.
  • Make sure you have the lowest rates 
    If you haven’t looked at your Energy Plan in a while, you might be paying more than you need to. Get in touch with your current Energy Provider or talk to other Energy Providers to see if they can offer you a better deal. Just be sure to check if any deals have limited lifespans, leading to them increasing in price after a certain point.13Australian Competition & Consumer Commission – Electricity prices and plans You may also be able to access concessions or rebates depending on your circumstances and location to help reduce the cost of your energy bills.
  • Pay your bill on time or ask for an extension 
    Some providers offer discounts for paying on time. Set up reminders in your calendar to pay your bill on time or you can use direct debit. Additionally, if you are unable to pay the bill when it is due, you may be able to negotiate an extension or payment plan with your Energy Provider.14Moneysmart – Problems paying your bills and fines  This can help you avoid paying late fees on top of your bill. 

Am I eligible for an energy relief fund?

High energy bills have had a large impact on many households, which is why the Australian Government created the Energy Bill Relief Fund. Administered through state and territory governments, the fund has up to $3.5 billion in relief available for eligible households and small businesses. This includes a $300 rebate on your household annual electricity bill (applied quarterly from 1 July 2024). Small businesses can expect a little more with a $325 annual rebate.

Depending on your state and territory, you may be able to access additional cost of living and electricity bill assistance, rebate schemes or discounts. Further, as mentioned above, you may also be able to negotiate payment plans and the like with your Energy Provider.

Where can I compare Electricity Providers?

Save hours on research time by comparing a range of Energy Plans with iSelect. A better value Electricity Plan could be just around the corner.  

Get started on comparing energy plans today!

Save time and effort by comparing a range of energy plans with iSelect

iSelect does not compare all energy providers or plans in the market. The availability of plans may change from time to time, depending on who iSelect’s providers are and what plans they make available to iSelect. Not all plans made available from iSelect providers may be compared by iSelect either due to commercial arrangements, area or availability, so not all plans or providers compared by iSelect will be available to all customers. Some plans and special offers are available only from iSelect’s contact centre or website. Energy plans are available only for properties located in eligible areas of Victoria, New South Wales, South East Queensland, South Australia and ACT. Click here to view iSelect’s range of providers.