Energy plans and bills have become more complex over time but that doesn’t mean you can’t sign up to the best deal available and dodge confusing terms and conditions.
Here are some tips that will demystify the world of energy and save you money as we ride the cost-of-living crisis into the new year.
Compare energy plans at least once a year
The Albanese Government’s power bill relief plan could save you $230 in time for next year’s winter crunch but that’s not going to be enough to fully shield households.
One of the best things you can do to take control of your energy bills is compare energy plans at least once a year and avoid paying the loyalty tax. This is because a lot of plans with benefit periods (i.e. long-term discounts) will run their course after 12 months and you’ll likely be moved on to the provider’s standing offer plan.
This is when you will notice your bills start to creep up again because you’re no longer on a competitive deal from your provider.
Tip: Compare all your options before choosing a new plan and then ask your current provider if they can offer you a better deal. According to Finder’s database, the difference in some states between the cheapest and most expensive plan can be around $200-$300.
Look out for these details when searching for a better deal
You’re now probably wondering where to even begin comparing energy plans and how to know if you’re getting a good deal.
The first step is to have your energy bill handy. You can start comparing options available in your area through comparison services such as Finder. Once you’ve input your postcode and bill details, it’ll show you plans and annual estimates according to your current energy usage.
Some things to look out for when comparing plans include:
Look at discounts/reference prices. The government introduced the reference price back in 2019 to help customers compare energy plans. For example, providers will sometimes show a plan being "10 per cent less than the reference price" or that you will receive a "10 per cent discount". Both mean the same thing. Don't settle for plans that are above the reference price. These will be stated as “10 per cent more”.
Estimates with conditional discounts. If the annual cost estimate for a plan includes conditional discounts, make sure you can meet these each month or quarter.
Watch out for extra costs. These can include late-payment fees, credit card fees, and disconnection and reconnection costs. Keep in mind disconnection and reconnection fees strike only when moving between properties, not when you switch plans at an existing property.
Cooling-off period. Remember you have a 10-day cooling-off period, which means if you decide you’re not happy with your new plan or provider, you can cancel without penalty.
Tip: If you’re still not clear on any terms and conditions, it’s always good to contact the retailer for clarity before signing up. You can also check out the best energy plans and providers across Australia right now as a first step.
Lifestyle changes can save you money in the long run
Sometimes we all need a friendly reminder to do things because we tend to get a bit lax.
This includes things such as:
Turning off lights when you’re not using a room
Switching off appliances at the wall. Even standby mode consumes power and you are missing out on around $100 a year in savings
Don’t overload your fridge and freezer, otherwise they’ll need to work hard to keep your food cool and use more energy. Ditch the second fridge if you don’t need it
If your budget allows, invest in energy-efficient appliances and ditch the power guzzlers
Washing clothes in cold water can save you $50 a year
Ditching the clothes dryer for the clothes line - even once a week - could save you $70 a year
Have shorter hot showers and perhaps invest in an energy-efficient showerhead and save at least $210 in a year if it has a 3-star rating
Australian summers can get very hot. However, each degree higher on your air conditioner can save you 10 per cent on running costs. For example, consider setting the temperature to 24 degrees instead of 22 degrees. Alternatively, you could use a good pedestal fan to keep cool for longer
Consider investing in solar
According to a national Finder survey of 1,010 people, around 15 per cent of Aussies are considering installing solar panels in light of this year's price hike that’s seen bills go up by up to $300.
More price increases are on the cards in the new year, with the Australian Energy Regulator warning of a further 35 per cent rise in 2023.
Upfront costs for installing solar panels can vary between $4,300 and $9,750. You can work out your payback period using a calculator and see if you’re eligible for any solar rebates that could help you with upfront costs.
Don’t set and forget your energy bills
We’ve all had this approach with energy. We sign up to a plan and that’s that. Especially when there’s direct debit involved.
However, without knowing how much you’re paying each month or quarter, you won’t realise until it's too late that your bills are increasing.
Keep an eye on your utilities so you can make changes before it’s too late. This might even come in handy if you’re being charged more than you should. Perhaps they’ve not read your meter correctly and instead of paying for a two-person household you’re paying for a five-person household without even realising.