Households pay higher electricity bills for the same service

Rebeccah Elley

Monday 24 October 2016

Australian households of the same size and type, using the same amount of electricity could be paying hundreds more for their electricity service than their neighbours, according to the latest data collected by Mozo.

Households pay higher electricity bills for the same service
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Charges dictated by energy distributors, that make up a large proportion of an electricity bill are to blame for the price discrepancy, says Mozo Director, Kirsty Lamont.

“Living on the right side of an arbitrary energy distribution boundary can mean paying hundreds more each year, and it’s simply luck of the draw,” she said.

While an electricity distributor for a particular house purely depends on its location, consumers in different states can choose the cheapest provider and plan based on their energy usage patterns.

"Given a high proportion of an electricity bill is made up of costs decided by the distributor, it’s all the more reason for consumers to shop around for a better deal on the thing they can control – their provider,” said Lamont.

Mozo’s new energy comparison service compares 1100 plans from 22 providers across 30 regions in Australia.

Mozo’s energy experts crunched the numbers to find that an Australian family can save $270 on their electricity bill annually by switching from the average priced plan to the best deal in the area. In turn, switching from the least competitive plan could lead to an even bigger saving of $613.

Biggest Annual Electricity Savings by State:

State

Avg usage (kW/h)

Highest electricity charge

Best available offer

Potential savings from switching

NSW

6,532

$2,736

$1,752

$984

VIC

4,992

$2,312

$1,456

$856

QLD

5,732

$1,992

$1,644

$348

SA

6,108

$2,624

$1,848

$776

ACT

7,856

$1,780

$1,472

$308

WA

5,650

NA

$1,787

$0

NT

6,754

NA

$2,196

$0

TAS

9,826

NA

$2,802

$0

N.B. Where several distributors exist, the distributor area with the biggest savings was chosen i.e. Essential in NSW and Ausnet in Victoria. Northern and Western Qld, WA, NT and TAS are non competitive energy markets with only one supplier. Data correct as at September 2015.

The results show that across Australia, average electricity bills differ by as much as $779 based on a three person household using their state’s typical amount of electricity.

“This figure highlights just how inconsistent pricing can be from state to state and hammers home the need for families to shop around.”

“Depending on where you live, families could be saving as much as $984 each year on their electricity bills, that’s a decent sized saving and certainly one worth switching for,” said Lamont.

Consumers looking to compare energy providers to find out if they can save money on their electricity bills can use Mozo’s free comparison tool to shortlist the cheapest plans in their area.

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