Understanding the Australian Energy Market
The good news for Australians coast to coast is that you now have freedom of choice when it comes to electricity and gas suppliers in Australia. By using our helpful electricity comparison service, you can compare from a wide variety of Australian electricity and gas retailers to choose cheaper rates available to you today.
A quick and convenient electricity comparison is available for Victoria, South Australia, New South Wales, Queensland, and the ACT to compare from a number of leading electricity retailers using our accurate electricity comparison service. Australia also has several options in natural gas suppliers that provide gas for both domestic and overseas purposes.
If you want cheaper rates from Australian electricity and gas suppliers and don’t know where to begin, start with a simple price comparison from Electricity Wizard. All you have to do is fill in the form below for a free quote at no obligation to you or call 1300 763 849 to speak to one of our expert representatives!
Deregulation of the Australian electricity and gas industry
State-by-state, individual governments have made the decision to deregulate energy industries. The main reason behind this change was to provide customers with fair access to cheap gas and electricity rates by creating competition in the marketplace.
And create competition it has. Today, there are a number of different Australian electricity and gas retailers; with anywhere from 15+ electricity retailers now operating in most States, Australian consumers now have the freedom to compare providers to choose the cheaper supplier with individual prices and plans that best meets their needs.
Gas distribution in Australia
Since the 1990s, gas pipeline infrastructures in Australia have changed ownership. Regulatory modifications have also been made to the natural gas distribution industry, which has caused the dissolution of several gas suppliers to become separate gas companies that monitor transmission and distribution. Currently, many of these companies are now privately owned.
The government has continued to create regulations that allow third-party access to gas pipelines. These regulations have been passed to prevent monopolies from developing in the marketplace so that pricing and market competition will continue to remain fair for customers in Australia who need cheap access to power.
According to the Australian Energy Market Commission, the gas market operator for Eastern and Southern Australia, the National Gas Objective, found in the National Gas Law, has been introduced to promote efficient operation and investment for the use of natural gas services to protect the interest of consumers over the long term.
These regulations ensure fair interactions regarding:
- Gas price
- Gas quality
- Gas safety
- Gas reliability
- Gas security
In light of these government regulations, you can rest assured that your gas and electricity will be safe, affordable, and secure, regardless of which supplier you choose. This is why it is more beneficial than ever before to compare electricity and gas retailers in Australia to get a lower rate on your power bills today!
How to compare gas and electricity rates
As we mentioned, the deregulation of the energy market in New South Wales, Victoria, South Australia, Queensland, and the ACT provided the opportunity for a host of new energy suppliers to come online. All this competition has now put the power into your hands, as you’re able to look around and compare plans and rates, and find a supplier that provides a deal that suits you.
Understand your electricity bill
So you can compare your electricity rates more efficiently it helps to first get an understanding of how your bill works. Your bill is made up of two main costs: the electricity that you use (the usage charge), and the cost of your electricity supply (the supply charge).
The usage charge is what your retailer charges you for your use, and comprises peak time and off-peak-time electricity usage charges (charged in c/kWh) and “service to property” fees. The service to property fee is a charge for getting your electricity to your home. Retailers set their own usage charges, meaning the cost is likely to change depending on which supplier and plan you look into—but this means that this is where you’ll find the biggest savings.
The supply charge is what you pay to stay connected to the electricity grid. This usually remains the same every bill, unless your retailer changes their pricing. Keep it in the back of your mind when comparing suppliers that if your supplier has a surprisingly cheap usage fee, it’s more than likely they’ll offset this with a higher supply charge.
So which plan do you choose for your electricity?
When comparing suppliers and looking at plans, there are two types of plans you’ll see the most: a standing offer, and a market offer.
A standing offer is a generic, basic plan; a default electricity package with a minimum set of terms and conditions, which follows the rules set out by your State’s Government. For the most part, these type of plans are leftovers from the pre-deregulation days.
Standing offers are provided so that every consumer has access to the provision of electricity services. The price of these types of offers are set by the retailers, and are generally more expensive because they don’t receive any discounts or special offers.
A market offer is different, as the terms and conditions, rates, features, discounts—basically, everything is set by the retailer. These types of plans are where retailers start to get competitive.
It’s these market offers you should be comparing so you can start saving. However, it’s important to remember that even with something seemingly as simple as electricity you have to make sure you getting the best value for your money. The cheapest electricity rates might not necessarily guarantee you the best service, and vice versa.
With so many plans available to the consumer, doing an electricity price comparison can seem daunting. But it doesn’t need to be that hard. Grab a pen and paper, find your previous electricity bills, and work out what you’re looking for.
Here’s how we recommend you compare retailers.
An electricity plan is a long-term commitment, so work out what matter to you in a supplier. Would you prefer they be locally-owned and operated? Or are you more conscious of using green energy?
Whatever your preference, there’s sure to be a supplier out there that matches your beliefs. Have a look around and see what you come up with.
Once you’ve determined what’s important to you in a business, have a look at your previous energy bills. Has your usage changed much over the last few bills? Knowing your average electricity usage is important when choosing the type of plan that’s going to suit you.
Now it’s time to dive in and see what electricity suppliers are offer in their plans. Here are a few things to keep in mind when you’re comparing plans:
- Know what type of plan you’re getting – You’ll usually find two types of plans available to you, fixed rate plans and variable plans. A fixed rate plan guarantees you get charged the same usage rate for your entire contract. A variable rate plan means your rate can changed based on the wholesale energy market, and at your retailer’s discretion.
- Check the terms and conditions – Read the terms and conditions of your plan carefully to make sure you know what’s involved. Make note of any changes to rates, your tariffs, or any fees. Knowing exactly what’s involved in your plan means there’s less of a chance of any surprise changes in the future.
- Will the supplier match rates? – With the amount of competition on the market today, electricity suppliers want to land you as their customer, so a lot of them will be willing to match, or even beat, rates offered by rival companies. So ask the question—doing so gives you the opportunity to get a better rate, with a supplier that you prefer.
- Do they offer any discounts? – You’ll also find that a lot of suppliers offer discounts on certain elements of their plans, in order to make them more attractive. See what they can do for you—there might be discounts available for things as easy as setting yourself up with direct debit, switching to email correspondence, or even just for paying your bill on time.
But make sure you check to see what the discount is on, as there’s a big difference between a discount on your usage rate, and a discount that covers the entirety of your bill.
So that you keep your prices down and continue to save money, we recommend you compare gas and electricity rates every 12 to 24 months. That way you can stay on top of the competitive market, and make the most of any new technology that may become available.
If that all sounds like it’s too hard, the good news is that you don’t have to do it alone.
Get a better deal on your electricity bills
At Electricity Wizard, we do all the hard work for you. When you call us, we’ll compare your rates and plans against our preferred suppliers available in your area and help you select a great plan for you to cut down costs and meet any other criteria you may have. Best of all, our service is completely free, so what do you have to lose?