To help you compare electricity prices and find the best deal for you, we’ve put together this guide that shows you how to understand electricity pricing and what to look for in an energy provider.
Understanding Your Energy Bill
For many people this is where the problem is – not understanding exactly what they are paying for. This leads to much confusion. To break it down for you here is our explanation in understanding your electricity bill in simple language:
- You are charged a daily supply charge which is basically the cost of getting electricity to your residence (even if you don’t use any) and appears on your bill as a total amount, or as cents per day.
- The reason why you still need to pay a daily supply charge even if you’re not using any electricity is because you are required to pay by law to pay for the supply and to help pay for the actual electricity towers.
- This daily supply charge can change according to the time of day you use your electricity and the type of contract you have.
- The price of electricity is higher during ‘peak times’ usually on weekday afternoons and evenings, when the demand for electricity is highest.
- The daily supply charge can also change depending on your location, as each state and territory makes its own decisions about the costs involved in energy supply. Speak to your energy provider to find out more information.
Questions to Ask Before Signing up to an Electricity Deal
Once you have at least an understanding of how electricity pricing works it’s now time to ask the following questions to your electricity provider. These questions should also be be applied to your gas:
- Are you offering me the plan with the lowest usage charges?
- Is this plan part of a contract? How long is it? Are there any exit fees if I leave?
Do you offer discounts?
- How much money will I save per year with this plan?
- What are your late payment fees?
- How does your plan compare to the Victorian Default Offer (VDO)?
- What other perks and incentives can you offer me?