Blog Post Tuesday 12 July 2016
It’s a fact - everyone needs electricity. Whether you are solar powered, generator powered or just plugged into the grid like most of us, we need it. It’s just about who pays for it, and how much.
So considering that it’s such a critical service, it’s surprising how disengaged most people are from their energy retailer. Ask around and most of us aren’t sure what plan we’re on, what rates we pay (some people aren’t even sure which retailer they are with).
Face it, energy is boring. It’s electricity and gas. We just want it to work, not talk about it - right?
Until the bill arrives.
Energy costs are a significant household expense. And if we can pay less, why don’t we? Too hard? Too complicated? Are your eyes already glazing over?
Remember this: Energy Retailers are set up to give you a good deal. The competitive nature of the market requires this.
You just need to work out how the offers are structured and make sure you take advantage of every benefit they are willing to give you.
And it's not that complicated, there are really only 5 things you need to know:
You would be surprised how many people fall at this hurdle. When was the last time you checked your bill? Some plans in the market have conditional benefit terms, meaning that the discount offer is only valid for a limited time (12 or 24 months usually). And once you are passed that period, you’re still on the same plan, but you no longer enjoy the discount you signed up with.
So what do you do? Sometimes it’s as simple as re-signing up to the same plan to start qualifying for the discount, or call your retailer and ask them what the best deal for you is. Or, you can look for a retailer where the discounts don’t expire, then you’ll have one less thing to worry about!
Our energy bills have 2 components - a variable usage charge (depending on how much you’ve used), and a daily supply charge - fixed per day rate. The supply charge is constant through the month and if you are someone who doesn’t use much energy, it could account for almost half your bill. So make sure your energy discounts apply to the supply charges as well. That way, when you reduce your energy usage, your entire bill will shrink.
Sounds simple doesn’t it? Most energy plans offer pay-on-time discounts, meaning retailers are willing to offer significant savings if you pay by the due date. Why wouldn’t you take advantage of that?
What if you’re struggling? Don’t worry, most energy retailers have hardship protocols, so if you’ve fallen on hard times, don’t be afraid to give your retailer a call. They will be more than happy to work something out with you.
Don’t be afraid to call the retailer and ask if the offer can be improved. The market is competitive and dynamic so things change all the time. You might be able to get a better deal simply by going on direct debit, or opting to receive bills by email. An easy thing to do. Remember, our ultimate goal is to pay less.
Another good tip is to ask for a bill comparison. Pull out your latest bill, give them your usage numbers and they will work out what it will cost you on their plan. If you are too busy, most retailers will let you send your bill in by email and they will call you back.
Perhaps this sounds contradictory to the above, but the energy plan is only part of the story. Remember, every energy retailer already has thousands of customers just like you who have the same needs and concerns as you do. Look out for reviews and learn what others have experienced. It really is just a google away or try review sites like Product Review.
The Canstar Blue website also has an interesting article on how to compare electricity costs.
Ultimately it’s your decision, but the more you understand, the less scary it is.
We all need electricity, but that doesn’t mean you have to pay more for it.