Energy prices officially increase today: How much more will you pay?
Electricity prices are going up across most of the country, so how can you avoid an expensive energy bill?
Today, the government "default market offer (DMO)" or "reference price" for electricity resets. It changes annually and this year it's increasing by up to 18.3%.
We're going to cover:
- How much energy bills are going up by
- Why energy prices are rising
- How to switch energy plans
- Ways to lower your energy bills
How much are energy bills going up by?
Approved rises are different in each state. Here's what's happening across the country.
|State (Network)||% Change||Change to average yearly bill|
|ACT||1.25% decrease||$23 less|
|NT||Not available yet||-|
|NSW||9.6% to 18.3% increase||$210 - $369 more|
|Queensland (South-east)||12.6% increase||$220 more|
|Queensland (Regional)||9.2% increase||$119 more|
|SA (SAPN)||9.5% increase||$198 more|
|Victoria||5.0% increase||$61 more|
Your actual costs could be higher depending on your usage and your retailer.
Confusing electricity jargon explained
Before we go any further it's important to understand the terms used by electricity providers: default market offer, reference price, market offer and standing offer.
- Default market offer (DMO). This is the maximum price retailers can charge for a standing offer plan. This is called the Victorian Default Offer (VDO) in Victoria.
- The reference price is a benchmark for comparing plan prices to the DMO. Every plan will state a reference price.
- The price of a standing offer can't exceed the DMO/VMO. The price also can't change more than once every 6 months.
- A market offer is a plan that usually includes a discount or incentive. It can be a fixed-rate or variable-rate offer.
You might sign up for a market offer plan that is 22% less than the reference price. It includes a 12-month benefit period. Once that 12-month period is over your provider can move you to its standing offer plan which matches the DMO price. In this scenario, after your first year you'll start paying more (unless you shop around for a new market offer with another provider).
Don't get ripped off
Energy retailers are also allowed to sell market offer plans higher than the reference price but they must:
- Let you know how the new plan compares to the reference price.
- Let you pay only the government reference price even if all their discounted plans are unavailable.
If the plan price you're being offered is higher than the reference price you can ask to be put on the standing offer OR shop around for a new provider.
What about gas and solar?
Gas and solar prices are changing too. AGL has already announced new gas charges for customers on standing offers from today and for those on variable market rate contracts from 1 August. Other retailers are expected to follow suit.
Origin Energy and others have also started slashing solar feed-in tariffs. Some providers are even charging customers for sending "excess" power into the grid.
Why are energy prices rising?
Australia and other parts of the world are experiencing an energy crisis. Wholesale energy prices started to increase after Russia invaded Ukraine and then a series of generator outages or equipment failures in Australia followed on from there.
Some experts would agree Australia was headed this way already with an over-reliance on older coal and gas-fired power plants and slow uptake of renewable energy. It hasn't helped that this has all been happening in winter when many households use more power for heating – we very narrowly avoided widespread blackouts just over a week ago.
All of this means that this 1 July reset is a lot more dramatic than it has been in recent years.
From 1 July prices have risen. Switch and save nowCompare plans and switch through Finder to find a deal that's right for you.
How do I switch energy providers?
Switching to another energy provider can be done in 3 simple steps.
- Review your current plan. Check what your benefits are and what your typical usage looks like.
- Compare energy plans online. Find one that suits your household needs and compare the prices against the rate you pay now.
- Make the switch. Your new provider will handle the paperwork and you won't be without power during the changeover. There's also a 10-day cooling-off period in case you change your mind.
It's that easy and can easily be done in an afternoon (it really comes down to how much research you decide to do).
Still not sure? We've explained everything we think you need to know in more detail in our guide to switching energy providers.
What else can you do to make energy bills cheaper?
Unfortunately, Australia's energy crisis isn't going anywhere soon which means it's a good idea to start looking into short and long-term solutions to save.
It might seem obvious but in the short term changing your energy use habits is the easiest way to start reducing your energy bills.
The smallest lifestyle shifts like turning off the lights as you leave a room or switching appliances off at the powerpoint all add up and can result in substantial savings when every dollar counts.
See all of our tips for saving on your energy bill here.
As the news of energy price rises came out many states moved to immediately offer support.
- New South Wales: Up to $1,600 support for residents facing financial hardship.
- Queensland: $175 payment automatically applied to your next power bill.
- Tasmania: $180 winter bill buster automatically applied to electricity bills for concession holders.
- Victoria: Claim the $250 power-saving bonus from today.
- Western Australia: $400 electricity credit, apply before 31 October 2022.
Apart from these support payments each state or territory government generally has at least a few rebates available especially for seniors, low-income families and concession card holders.
Depending on which state you live in there are also rebates for heating, medical cooling, life support and other important health needs.
You can use energy.gov's tool to look for rebates you're eligible for in your home state.
Solar is increasingly the way to go for household energy needs. The environmental incentives are great but feed-in tariffs can really help make a difference to your energy bill.
The main barrier to getting solar is the cost of installation (or access at all if you're a renter).
Fortunately, it does eventually pay for itself with a 2.5v system breaking even after a minimum of 4 years.
Want to shop around for another energy provider? Compare energy plans on Finder.