Why does it seem energy plans are getting more and more complicated?
Paying for electricity isn’t quite what it use to be.
All these decisions that have to be made and some serious adulting that has to occur.
Like, what the fling-flanging are these electricity rates (and plans) you’re meant to choose from?
If you’re still not quite sure what they mean or how they can impact your energy bill, don’t go anywhere. We’ll talk you through all the major talking points, so you don’t end up paying more than you need.
what is peak and off-peak electricity?
Peak and off-peak refer to the times of day electricity has been used in your home.
Off-peak indicates periods when residential homes and businesses are using less electricity. The hours deemed to be off-peak will differ depending on the state you live in, but they typically are late at night, or during the daytime throughout the week (i.e. 9 to 5 Monday-Friday).
On the flip side, peak times are periods where electricity is in high demand . Like when everyone’s cooking up a delicious dinner and watching TV after work, or during a rainy weekend when everyone’s stuck inside binge-watching Netflix (guilty!).
how do peak/off-peak rates impact my energy bill?
When a large proporition of the population use energy at the same time, it can put quite the strain on Australia’s electricity networks.
For this reason, many electricity providers offer time-of-use pricing with their energy plans to entice customers to save money by using less power during peak energy usage periods.
So, to sum it up, you pay different amounts for your electricity depending on the time of day you use it.
- Lower rate $ = off-peak electricity times
- Higher rate $ =peak electricity times
Energy prices in Australia have increased considerably over the past decade. This is due to a range of factors such as replacement of poles and wires, population growth, increased electricity demand, and higher standards required for power reliability. These have ultimately led to increased network costs Australia-wide.
should you sign up for a time-of-use energy tariff?
You should only sign up for a time-of-use pricing rate if you genuinely feel it will be financially beneficial. For instance, if you’re the type of person to use most of your electricity during the weekdays or late at night.
But be wary that you could easily end up paying more with a flexible pricing rate. Canstar Blue research found peak time prices can be up to four times more expensive than their off-peak counterparts.
At the moment, these time-of-use energy plans don’t seem to be holding up to their savings promises. So if you do switch to a flexible energy tariff, there’s potential to be stung with bill shock, so it pays to do a bit of research in order to compare how much you'll pay with your new energy plan.
If you happen to be on the hunt for a new plan before the colder months kick in, amaysim energy plans could be your perfect match and are designed to take the hassle out out the energy market for Aussies consumers.