How to Choose an Energy Provider | Click Energy

Blog Post Wednesday 19 September 2018

How to Choose the Best Energy Provider for You

How to Choose the Best Energy Provider for You

Whether you're moving house or seeking a more competitive energy plan, finding the right energy provider doesn't have to be a stressful process. By following these steps, you can find a gas or electricity plan that you're happy with, you're not paying too much for, and so that you don't find yourself switching again soon.

1. Ask for an Energy Price Fact Sheet

Under the law, energy companies are required to provide Energy Price Fact Sheets (EPFS) (recently the name changed in some states to a Basic Plan Information Document) to help customers understand and compare offers. As a consumer, the EPFS is a valuable sheet of information that allows you to quickly understand the key terms of the contract. You still need to read the fine print, but the EPFS helps you understand the key terms at a glance. The information on your EPFS includes the following.

  • Unit price - How much is the unit price (or usage rate) and how it could be varied by the retailer.
  • Daily supply charge - The daily supply charge is the second component of your bill (the unit price being the first). This is how much you'll pay for being connected.
  • Fees - Any key fees could be charges, such as account establishment or sign-up fees, exit or cancellation fees, payment processing, and re connection.
  • Discounts and incentives - Any loyalty incentives, discounts, contingent discounts like pay-on-time offers, dual fuel discounts, and direct debit discounts.
  • Length of contract - The EPFS should include the length of your contract and the cooling-off period.
  • Where to find terms and conditions - The EPFS isn't meant to be comprehensive, and it should give you details on how and where you can read the full terms and conditions.
  • Contact details - The EPFS should also contain the retailer's name and contact details.

2. What type of contract is it?

Something else to consider is the type of contract being offered. Retailers typically offer two main types of contracts. If it's a standard retail contract, it comes with model terms and conditions set by the law. This type of contract usually has no exit fees and it allows you to switch to another type at any time. The prices can be changed only once every six months.

If it's market retail contract, the retailer is offering you market prices, and so the contract is not based on model terms and conditions. Whichever you choose, make sure you understand the fine print.

Other types of contracts include fixed bill versus fixed price. The fixed bill contract charges you a fixed amount regardless of your usage, while the fixed price contract is based on your daily supply charge, plus your usage multiplied by the unit price. The fixed price contract is far more common.

3. Understand discounts

Some retailers will offer attractive discounts but take time to do the maths and work out what you're really saving. Whether it's sign-up discounts, pay-on-time discounts, direct-debit discounts, or so-called unconditional discounts, consider the incentive in the context of rates, contract period, and fees and charges. Think about how much you're really saving over six months, 12 months, or longer, and whether the discount stops applying after the first three months, for example 

4. Ask the key questions

The EPFS will help you understand the key terms of the contract, but you'll probably have more questions about your contract and the retailer. Some of the additional questions to ask include the following.

  • Expiry - What will happen when your contract expires? Does it automatically go on to a month-to-month arrangement or do you have to renew for another year?
  • Moving house - Ask the retailer what happens when you have to move house. Will it be easy to reconnect with them?
  • Security deposit - Will you have to pay a security deposit to get connected?
  • Bill - How will you be receiving your bill and how often are bills issued?
  • Payment options - Do they have convenient payment options? For example, BPay, credit card, or direct debit.
  • Other rates - What are their peak and off-peak rates, and are there seasonal difference in rates?
  • Transfer - If you're moving to a new retailer, ask them how long it will take to transfer you. Sometimes it can take up to a few months because the transfer may not be completed until after your next scheduled meter reading.

5. Read the fine print

Once you sign the contract, you'll be subject to the terms and conditions, so make sure you double check the contract. Take time to read through the fine print, and ask the retailer about anything you don't understand. Get advice if necessary.

Making the right choice

Whether it's your gas or electricity, finding a new provider and plan you're happy with takes a bit of research. The most important steps in the process is to understand the contract, consider discounts in terms of long term costs, and make sure you're clear on the key terms. If you follow these steps, you'll likely end up with a competitive contract and possibly save more on your energy costs.