New protections may help Australians concerned with rising energy bills
Australians are feeling the bill crunch more than ever, but will a decrease in wholesale power prices help?
According to research by Finder, almost 10 million Australians are concerned about an increase in their bill due to self-isolation^. While energy companies do generally have financial hardship programs in place, this doesn't change the potential increase in energy use Australians may see due to increased time at home.
Will energy prices go down?
All of this comes as wholesale power prices have fallen to a record low, coming in at just about half of what they were at the start of the year thanks to increased renewable generation, falling demand and lower gas prices. This begs the question of whether these price drops will be passed on to customers and help relieve bill stress.
In theory, they should. The Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Bill 2019, which goes into effect from 10 June this year, gives the Australian Competition and Consumer Commission (ACCC) the power to punish energy companies that don't reasonably pass on wholesale price drops.
Don't just rely on protections, be proactive with your bill
With that said, if you're looking for lower energy prices, you're still better off comparing your current energy plan to others on the market. Even though you should still benefit from decreased wholesale prices regardless of your provider if they do end up being passed on, there's always more room to save by looking for a cheaper provider.
Should you switch?
The answer to this question depends on the results of your comparison, as well as your current energy plan's terms and conditions. If your last energy bill is higher than other rates on the market, you absolutely should consider switching, so long as you don't have a contract with hefty exit fees preventing you.
If your rates are lower than the general market, you should still examine your plan. It's possible that these low rates are the result of a conditional discount and may expire in the months to come. In this case, find a good plan to switch to and make the change when your benefit period expires.
Obviously, rates aren't the only reason to switch. Things like green electricity ratings and customer service are worth factoring in if they're important to you.
Other tips for saving on energy
We've put together a more in-depth guide about how to save on your energy bill and potentially alleviate your bill stress, but here are some important tips:
- Research. Understand what's driving up the price of electricity and how your house and lifestyle affect your own bill.
- Investigate and organise. Investigate your household's energy use to understand the biggest contributors to your electricity bill. Search around your house to find energy "hotspots" – devices that are consuming large amounts of power.
- Compare. Make sure to shop between different electricity and gas providers in your area for the best deal. Sign a contract with a variable rate that suits your lifestyle and power-usage patterns, potentially with a different tariff. Determine whether installing smart meters on some appliances might help or whether you should buy more energy-efficient devices than you have now.