Understanding what you pay
In the world of energy, a tariff is simply the price you’re charged for the energy you use. Tariffs vary and depend on the type of meter you have and who your energy distributor is.
What’s a distributor?
Your energy distributor is the company responsible for the poles, wires and gas pipes in your area. You’ll find the name of your distributor at the top right hand side of your energy bill.
A closer look at electricity tariffs
Different tariff rate types apply and depend on where you live (your distributor zone) and the type of meter you have at home.
What’s on your bill
On your bill you’ll see that electricity tariffs are divided into two parts. These are your supply and usage charges.
- The supply charge is a daily service charge to deliver electricity to you.
- Usage charges are rates charged for the actual electricity you use.
- Some tariffs - such as time of use - have variable usage rates depending on the time of day you use electricity.
- Demand charges – a charge based on your highest demand for electricity.
You can have a look under “Energy charges” on page 2 of your bill to see what type of tariff you’re on.
Electricity tariffs in detail
With time of use, different usage rates are charged for the electricity you use at different times: off peak, shoulder and peak. For some customers time of use rates can also include a demand charge.
- Off peak – charged when the electricity network has low usage, such as overnight or during times with high solar export.
- Shoulder – a usage rate that sits between peak and off-peak times. Shoulder rates are usually a bit cheaper than peak rates and are available in most states. Shoulder times can be a period during the day on weekdays or weekends. These times may differ between states.
- Peak - charged when the electricity network has high usage, such as in the evening.
Time of use pricing might be suitable for you if you’re home during the day on weekdays and use dishwashers and washing machines on the weekends or late in the evening. If you have a smart meter time of use can be set as the default tariff.
Demand tariffs, or demand charges, are billed based on your highest demand for electricity in kilowatts (kW).
This will depend on the type of meter you have:
- with a 5 or 30 minute smart meter, the demand charge will be based on your highest demand 30-minute interval during peak times.
- with a 15 minute smart meter, the demand charge will be based on your highest demand 15-minute interval during peak times.
They’ve been designed to encourage less electricity use during peak demand times when there’s more pressure on the grid. Demand pricing is available if you’re eligible and have a smart meter.
The rate stays the same whatever time of day or year you use your electricity. A single rate tariff is usually lower than peak, but higher than off peak and shoulder rates.
A single rate, also known as a peak only rate, might suit you if you’re home most of the time and use large appliances such as washing machines and dishwashers during weekdays.
Off peak refers to lower electricity prices during certain times, generally when electricity network usage is low. Off peak times usually are at night or weekends and vary depending on your area and meter type.
Controlled load electricity refers to electricity being used by a stand-alone item, like an electric hot water service, electric slab heating and irrigation pumps. Controlled loads are recorded by a separate meter and can be billed as an off-peak rate.
Any unused electricity that your home’s solar power system sends back to the grid, is credited to your bill after you’ve been charged for your electricity. The credit amount depends on what state you’re in and how big your solar power system is.
A closer look at gas tariffs
The tariff structure for gas depends on your state and the distributor in your area.
What’s on your bill
On your bill you’ll see that gas tariffs are divided into two parts. These are your supply and usage charges.
What are supply charges, fixed and variable rates and usage charges?
- The supply charge is a daily service charge to supply gas to you.
- Usage charges are rates charged for the gas you use.
- Some tariffs have variable usage rates depending on when you use gas.
You can have a look at the back of your bill to see what type of tariff you’re on.
What’s the difference between seasonal and non-seasonal gas rates?
A seasonal rate is charged between peak season (winter) and low season (non-winter). It can be charged as a single rate within these seasons, or as a block rate (a usage rate calculated on how much gas you use). This type of gas rate is only available in Victoria.
With a non-seasonal rate tariff, the rate stays the same, no matter what time of year you use gas.
In some places, we can’t supply gas. This might be because gas lines aren’t available to homes in your area, there’s no gas meter on your property or there’s an area restriction (e.g. only certain energy retailers can offer gas).
Other fees and charges
If you need to change your meter, disconnect or reconnect your energy or ask for a special meter read, charges may apply. Find out more about these fees and charges.
What are energy offers?
There are two types of energy offers - standard and market retail offers.
What’s the difference?
A standing offer is a basic energy plan with government regulated terms and conditions for most customers. The prices are set by us as the retailer with no discounts, such as our Basic Home energy plan.
Market retail offer
By this we mean an energy plan with the prices set by the retailer (that’s us) typically with a benefit or incentive (e.g. a discount or a credit to your bill) for a fixed amount of time.
Find out more on our Energy Plan Information page.