Understand the Electricity Market in New South Wales
Post on June 15th, 2015
Want Cheaper Power Bills in Sydney & New South Wales?
The first step in finding the best electricity company for your home or business is knowing your options. Understanding how the electricity industry in NSW works will help you to save money on your power bills.
The NSW Electricity Market Explained
New South Wales has the highest number of electricity consumers in all of Australia, the majority of which are located in the state’s capital city, Sydney. There are just over 3 million residential customers in NSW, plus over 350,000 commercial or business customers.
New South Wales generates its electricity using both renewable and non-renewable sources of energy, primarily coal, hydro, wind, and solar. Companies who own major electricity generators include AGL Energy, Origin Energy, Snowy Hydro, and EnergyAustralia. NSW also imports electricity via interconnectors linking to the Queensland and Victorian transmission networks.
Generators include the Coleambally Solar Farm, Murray Hydroelectric stations, Colongra Gas Turbine, Eraring Coal fired power station, and the Liddell open-cut coal station that’s due for closure in 2022. Of all the Australian states in the National Energy Market, NSW has the greatest reliance on black coal for the production of electricity.
Once electricity has been generated, it is transmitted via more than 13,000 kilometres of high voltage transmission line and cable managed by TransGrid. The costs of transmission are overseen by the NSW state government and the Australian Energy Market Operator.
Electricity is then distributed to NSW homes by three electricity distributors using almost 270,000 kilometers of electricity distribution line. The distributor’s role is to maintain the energy infrastructure that supplies power to homes and businesses. Distributors must fix faults, as well as maintain and upgrade the poles and wires.
Your distributor is determined by your geographical location. The three electricity distributors in NSW are:
Endeavour Energy (Wollongong and Western Suburbs including Penrith and Katoomba)
Essential Energy (Regional NSW including the North Coast, Central West, and Southern Tablelands)
Ausgrid (Sydney city, Central Coast, Hunter Valley and Newcastle)
While the wholesale price of electricity in NSW has risen dramatically over the past 5 to 10 years, none of the three distributors increased prices in 2018. In fact, the proportion of network charges as a percentage of the total bill decreased for customers in the Ausgrid and Endeavour.
The NSW Retail Electricity Industry
Electricity retailers then sell electricity to homes and businesses in NSW. It is these retail electricity companies that manage your bill and have the power to offer discounts on the price of your energy. In New South Wales, electricity and gas markets are fully deregulated, which means consumers are free to choose their electricity company and plan.
Retail competition between electricity companies in NSW means smart consumers who shop around can find excellent deals on their electricity. While standing rates are going up, it’s possible to find cheap electricity in Sydney and regional NSW with competitive market offers.
Choosing a Retailer in Sydney and New South Wales
The average electricity bill is comprised of wholesale, network, retail, and green scheme costs. It’s the retail portion of the electricity bill that customers in NSW can get discounts on in order to reduce their yearly energy costs.
The energy experts at Electricity Wizard can help with more information on understanding your electricity bill, the average cost of electricity in NSW, and how to compare the different plans and tariffs.
Essentially, retailers offer a range of plans with different features to suit the energy needs of consumers. Electricity companies have the freedom to set discounts of their choice, offer special deals, create bundled plans, and to set their own terms and conditions. These might include pay on time bonus discounts, extra discounts for using particular payment methods, exit fees, connection costs, or minimum term contracts.
Your choice of electricity retailer is more important than many consumers and business users realise. Comparing rates and plan features can mean hundreds of dollars difference in your yearly electricity bill.
The 2018 report on the NSW Tariff Tracking Project found that for households using an average 7,200kWh per annum would save $550 to $700 peach year by switching from the incumbent retailer’s standing offer to the best published market offer.
Even the price difference between market offers can vary dramatically. In June 2018, there were savings of $880 a year for the average household between the best and the worst market offer from retailers on the Ausgrid network. There were similar savings available in the other NSW networks with an $850 difference on the Endeavour network and $625 for Essential energy network users.
Customers who don’t take the time to compare plans and prices every 12 months risk paying hundreds of dollars more than they need to.
By choosing a supplier that doesn’t suit your individual circumstances, you can end up paying significantly more for your bills than is necessary. Some companies specialise in business or commercial energy supply, while others are more suited to residential customers.
Customers might prefer to choose an electricity company who offers electricity generated from renewable sources or who has a range of GreenPower plans. Customers might also prefer to choose an electricity company who is Australian owned or who has a local or Australian call centre for assistance. If you know you’ll always pay on time or want to use direct debit, your Electricity Wizard advisor will find you the best plans with these features to save you money.
Residential and Business Customers have many Energy Retailers to Choose from in Sydney and NSW:
- 1st Energy
- Alinta Energy
- Click Energy
- Diamond Energy
- Dodo Power and Gas
- Energy Australia
- ERM Power Retail
- Lumo Energy
- Mojo Power Pty Ltd
- Momentum Energy
- Next Business Energy
- Origin Energy
- Red Energy
- Simply Energy
With so many factors to consider, choosing the best electricity retailer to suit your individual needs can be time consuming. Choose the wrong retailer, and you could end up wasting hundreds of dollars every year.
Get a Better Deal on Your NSW 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 the leading electricity retailers in your area. We’ll help you find the cheapest price, the most convenient plan features, and the best company to suit your needs. Best of all, our service is completely free!
Try us today! Call Electricity Wizard now on 1300 359 779 or fill out your details below to have one of our comparison specialists help you get a better deal on your energy bills today!