How to read your electricity bill

Got a feeling you might be paying too much for your home energy but can’t tell for certain because you’re not sure how to read your electricity bill?

Don't worry, you're not alone.

Electricity prices dropped by as much as 6%^ during 2021, but many Australians haven’t felt the pinch.

Partly, that’s because it’s hard to know if your plan is still benefiting you.

In this guide, we'll break down how to read an electricity bill step by step, so that you can better understand exactly what you’re paying for.

What are the key parts of my electricity bill that I need to understand?

A typical electricity bill includes at least seven key components. Below, we take you through an example bill.

1. Account details

This includes your name, account number, and invoice number.

2. Your balance

This amount shows how much you owe or are in credit by.

3. Your payments

This section will include multiple details, including the ‘what, when, and why’ of your energy payments.

Generally, it’s made up of:

• Your tariff - This builds the payment base for your energy consumption. Tariffs vary from provider to provider and can depend on your meter. If you think the tariff you’re paying is too high, it can pay to shop around for a better deal.

• Your billing cycle - How often you pay, e.g. weekly, monthly, quarterly, or annually.

• Your charge or rate – This is the amount that you pay per kilowatt hour (kWh) used.

• Your total current charges – This is the amount that you will need to pay.

• Your payment method - This is the payment method you use to pay your energy bills, e.g. BPAY, direct debit, or credit card.

This section may also include any details of potential government rebates or discounts you're entitled to.

4. Your energy usage

This is a breakdown of how much energy you've used and how much it costs you.

Your energy tariff is broken down into two charges:

• Your delivery/supply charge - This is a set daily fee charged by your energy provider to deliver electricity to your home.

• Your usage charge - This is the rate your provider charges for the amount of energy actively used.

Energy usage is charged per kWh, but not always at a fixed rate.

You may, for example, be charged one rate for peak consumption and off-peak consumption.

Peak consumption tends to be when most of us are home and using the most electricity (e.g. in the morning before work, around evening/dinner time etc.).

Off-peak tends to be late at night when most of us are sleeping, or during the day when people are at work.

Your energy bill details how much energy you used as well as what rates you’re being charged at each of those times.

5. Your energy plan

When you sign up to an energy provider, you can usually choose from a number of energy plans.

This part of your bill outlines which plan you're currently on.

This is a really useful piece of information because some energy companies may move you to a different plan or onto a default market offer after the first 12-24 months, so this section tells you whether you’re still on the plan you originally signed up for.

You can also use it to cross-check if it’s still the best your provider has to offer you and get a sense of how your plan stacks up against competitors.

If this sounds like a lot of work, don’t worry – our experts can compare electricity plans for you in a matter of minutes and help you make the switch.

6. Payment methods

This section breaks down the different payment options available to you.

Keep a close eye on this one as you may be able to save a little depending on the payment method.

Some providers, for example, offer discounts for paying by direct debit.

7. Supplier contact details

If you need to talk to your electricity supplier for any reason, such as changing your plan or paying your bill, here's where you find all the key details you need to get in touch.

How do I know if my electricity bill is accurate?

The easiest way to check whether your electricity bill is accurate is to compare your actual meter reading with the reading detailed on your bill.

If the two figures are similar, then it's a good indication that the bill was accurate, though your current reading may be a little higher to account for any energy usage since the bill was generated.

What is the difference between actual and estimated meter readings?

The difference between actual and estimated meter readings may play a role in determining just how accurate your current bill is.

You can tell an actual meter reading because it will say “A” or “Actual” on your bill.

An actual meter reading means that somebody - either someone in your household or your supplier - physically took note of the reading on your electric meter and submitted this to the supplier who charged you based on that reading.

This is one reason why smart meters have become increasingly popular in recent years.

These digital devices are installed in your home and transmit accurate measurements of how much energy you're using.

They share the information directly with your energy provider, so no one has to lift a finger.

As a result, you get a more accurate bill that could save you a few dollars.

An estimated meter reading, on the other hand, is when a supplier estimates how much electricity you use based on your property’s previous usage pattern.

If your bill comes with an estimated reading it can be worth checking your meter to see how close the two match up.

There shouldn’t be too much of a difference, but if the two numbers seem a long way off, it can be a good idea to check in with your provider.

Why is my account in credit?

Sometimes, your electricity account may be in credit due to you making an overpayment or if your supplier has applied a special discount.

This credit may then be deducted from your next bill.

How often should I receive my electricity bill?

This depends on your billing cycle (how often your supplier bills you for your energy usage).

The most common billing cycles are monthly, quarterly. or yearly.

You can find what cycle you’re on by checking the payments section of your energy bill.

Can I change my billing cycle?

You can, but this varies from provider to provider and may depend on your energy plan.

How can I tell if I’m getting value for money?

The best way to check if you’re getting value for money from your energy provider is to compare your existing plan to others offered by your current supplier as well as those offered by competitors.

The rule of thumb here is, if it’s been two years since you last switched suppliers, it may be time to shop around.

At Compare Club, we help you compare plans from Australia’s leading energy companies, so you can be sure you get a great deal.

This guide is opinion only and should not be taken as financial advice. Check with a financial professional before making any decisions.

^AEMC, RESIDENTIAL ELECTRICITY PRICE TRENDS REPORT 25 NOVEMBER 2021, accessed April 1 2022.

Paul Coughran is the General Manager of Emerging Verticals at Compare Club. Paul has over 20 years of experience across a wide range of industries including Banking and Finance, Telecommunications and Energy. Paul leads a team of trusted experts dedicated to helping individuals make informed decisions about their insurance and utilities needs.

Meet our energy expert, Paul Coughran

Paul's top energy tips

• 1

  Australia’s top three energy companies still hold 64% of the total Australian market, even though competition was deregulated in 2017.

• 2

  If you don't shop around for energy providers, you’re probably leaving your savings on the table by failing to compare better value options.

• 3

  Most energy providers offer discounted rates for new customers, which is a strong incentive to switch.

• 4

  There should be no interruption when you switch energy providers. You'll need to pay a new company for your energy, but there won't be a disruption to your power supply.