Electricity prices predicted to decrease in 2020 – but will you pay less on your bill?
You may need to switch to take advantage of lower electricity prices.
According to the Australian Energy Market Commission (AEMC), electricity prices and bills are expected to decrease in the period from 2018-19 to 2021-22 by as much as 20%. It's largely down to wholesale costs decreasing in most Australian states and territories, as well as a number of new renewable energy projects.
Does this mean my electricity bill will decrease?
Not necessarily. The figures are predictions and don't guarantee the cost of electricity will go down. Actual price movements will be influenced by how energy retailers compete, adjustments in the wholesale and contract markets, and changes in policy and legislation. For example, the Victorian Default Offer (VDO) for electricity customers will increase by an average of 7.8% on 1 January 2020. This means customers on "standing offers" will likely pay more for their energy.
How can you ensure you actually get a cheaper bill?
Luckily, there are ways you can find a cheaper energy rate. By switching energy providers, you might be able to take advantage of the decreased energy prices in 2020. If you've been with the same energy provider for a number of years and are no longer benefiting from affordable electricity, now has never been a better time to switch plans.
Standing offers vs market offers
You can also get a cheaper deal by switching from a standing offer to a market offer. All energy retailers are legally obligated to make standing offers available (and are capped to a certain extent) to customers, but they're usually more expensive than market offers. Plus, the price can't change more than once every six months, meaning you probably won't see the benefit of decreased energy prices.
Market offers, on the other hand, let you take advantage of competitive offers as providers try to beat each other on price.