Energy Debt Rises as Aussies Cut Back on Heating

68% of Aussies surveyed say they’re reducing energy use this winter to save

Two-thirds of Aussies are cutting back on energy use this winter, new data from Select shows, as another round of price hikes hit and average debt bills climb by hundreds of dollars.¹1 iSelect commissioned i-Link Research to conduct an online survey between 28 Apr – 4 May 2025. The sample is n = 1,500 Australians. The data is weighted to represent the population by age, state and gender, and is representative of all Australian adults 18+.

Some households are facing more than $200 extra a year on average, and many are turning to shorter showers, sealing draughts and switching off appliances to manage the cost of staying warm.²2 energy.gov.au/households/quick-wins

iSelect comparison expert Sophie Ryan said the research reveals just how hard energy price increases are hitting household budgets.

“We know Aussies are doing what they can to stay on top of bills, but we’re seeing a clear trend of households sacrificing comfort just to get through winter,” Sophie said.

“The price Aussies pay for electricity or gas either likely increased on July 1 or will today (depending on their provider and where they live), and some bills by more than $200 on average.”³3 aer.gov.au/documents/aer-final-determination-default-market-offer-prices-2025-26-26-may-2025; www.esc.vic.gov.au/media-centre/independent-regulator-announces-victorian-electricity-default-offer; www.originenergy.com.au/pricing/price-changes/; www.energyaustralia.com.au/home/help-and-support/faqs/rate-changes; www.agl.com.au/residential/energy/energy-price-changes?cid=AGL-B1003092#accordion-a90f74c27d-item-13027f04a6

The latest Australian Energy Regulator (AER) quarterly retail performance report confirms the pressure, with average household energy debt rising by $502 in Queensland, $396 in South Australia, $275 in New South Wales and $124 in the ACT over the past year.⁴4Page 8, www.aer.gov.au/system/files/2025-06/Key%20trends%20-%20Quarter%203%202024%E2%80%9325%20retail%20performance%20data.pdf

Around 1.64% of electricity customers were in a hardship program, with an average debt of $1,984.⁵5 Page 11 – www.aer.gov.au/system/files/2025-06/Key%20trends%20-%20Quarter%203%202024%E2%80%9325%20retail%20performance%20data.pdf

Sophie added that while rising prices can feel out of your control, there are practical ways to reduce usage and potentially save money.

“While there are investments you can make, such as installing insulation to warm your home,” Sophie said.

“It’s a good idea to start with the basics, such as checking for draughts, turning off appliances at the wall, and only heating the rooms you’re actually using,” Sophie explained.

“Even small changes like switching to cold water for washing or slightly lowering your heater can add up, but. reviewing your energy plan can be crucial.”

“Recent iSelect research found 30% of Aussies who switched energy plans in the past two years said they saved money,” Sophie said.

“More than half those switchers said they are saving over $100 annually, and in this cost-of-living climate, that really matters.”

The Australian Government has proposed changes to energy market regulation aimed at improving affordability and transparency, which are currently under review.

“Energy bills are becoming unmanageable for too many Australians,” Sophie said

“While broader reform is welcome, there are things you can do right now to take some of that pressure off.

“Regularly checking and comparing your plan with the help of a comparison website such as iSelect can help you understand your bills and see if there’s a more suitable deal among their change of providers for your budget and your energy use.”

iSelect’s top 5 tips for finding a suitable energy deal

1. Don’t automatically default to the default – The DMO (or VDO) may not be the best value option for you.  Instead, take the time to compare both default and available market offers.

2. Don’t set and forget – Retailers are required to notify you when your rate changes or your discount expires. This should prompt you to compare other plans in the market to ensure you’re getting a competitive deal.

3. Don’t set and forget – Retailers are required to notify you when your rate changes or your discount expires. This should prompt you to compare other plans in the market to ensure you’re getting a competitive deal.

4. Flexible payment options – Pay your bills weekly, fortnightly or monthly, or sign up for bill smoothing, which will divide your annual usage into evenly spread smaller instalments, to help avoid bill shock.

5. Shop around – In the current environment, every dollar counts. Call an energy comparison service like iSelect and make sure you have a copy of your latest bill handy and see if you can save.

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.