Private health insurance is a must-have for many Australian families of all ages and sizes. Not only can private health insurance help your family save money on health care, it can reduce your tax liability. While these factors are important,…
How Many Energy Choices Do You Have?
The amount of choice you have in energy supplier depends on which state you live in. Places like New South Wales and Victoria have multiple energy supplier options, and you can switch between them freely if you are out of contract.
If you are under contract, you may be liable for an exit fee. However, suppliers in these states are also less likely to have exit fees attached to their contracts since there is so much competition.
The market values flexibility, and competition fuels customer-friendly policies.
There is considerably less competition in Western Australia, Tasmania, the ACT, and the Northern Territory.
Western Australia and Tasmania only have a few different electricity and gas options, with little difference in price.
These states are in a regulated price market, so suppliers can’t change prices to compete with one another.
While the argument for deregulation states that it gives customers more freedom, there currently isn’t very much choice in these smaller markets. As a result, the government regulates energy suppliers to make sure they don’t raise their prices too high.
Distributor vs. Supplier
Energy distributors and energy suppliers (sometimes called providers) aren’t the same thing. An energy distributors is a company that owns the power lines or gas pipelines. The energy supplier is the one selling you these utilities.
It’s important to understand that your energy distributor probably won’t change with your energy supplier. Distributors are based on location, so you’ll only receive a new distributor if you’re moving to a new area.
In areas with price regulation, there won’t be much of a difference between energy suppliers. You may find different benefits and fees, but the price of the electricity and gas should be the same.
Things to Consider
There are a few elements to consider before you decide to change your energy supplier. One supplier may appear to charge a cheaper rate, for instance, but their discounts and fees don’t match up to the competition.
Take a look at some of the factors to keep in mind when you’re making your decision to switch.
Most energy suppliers offer some form of discount to your energy bill. These discounts will come off of usage charges, supply charges, or both.
Consider the discount period, how much the discount covers, and the conditions of the discounts before you decide to make your switch.
One supplier, for example, could have a pay-on-time discount that comes off of your usage charges and ends after one year.
Another company might have a smaller discount, but it comes off of supply charges and usage, doesn’t have any conditions and has a benefit period that lasts the life of the plan.
Even though the former discount is greater, the latter plan is likely to save you more money in the long run. Don’t be distracted by a larger number when it comes to discounts; consider which one offers more value overall.
You may encounter a different set of fees, depending on the energy supplier you select. Some energy suppliers might charge a lower rate, but charge higher fees.
However, if you receive your bill online and always pay on time, there’s a good chance you’ll be able to avoid most of these fees.
Standard fees include late fees, credit card fees, and paper bill fees. Suppliers like to send online bills since it saves them money, and could charge you extra if you prefer to receive a hard copy of your statement.
Take a look at the fees each supplier charges, and compare any fees you think might apply to you.
Renewable Energy Offerings
Energy suppliers vary significantly in how they deal with renewable energy. Some have green plans that incentivise low energy use, while others do not.
As solar panels become more popular, more customers are interested in energy plans that include solar. While it’s common for major suppliers to include solar products, you won’t find them everywhere.
If you have solar panels – or are interested in installing them – you should take this into account when comparing energy suppliers.
When Should You Switch?
One major consideration when comparing energy suppliers is finding a good time to make the switch.
For example, moving house can be an ideal opportunity to make a change.
It’s simple to cancel your energy plan and set up a new one at your future address if your current supplier doesn’t charge you an early exit fee. Many energy suppliers will lock you into a contract with fees for leaving early.
Consider the savings you’ll receive from a new energy supplier and weigh that against the charges you could face by breaking an energy contract early.
In some cases, the monthly savings will be enough to justify an immediate switch. If not, you may prefer to wait until your current contract ends.
How to Switch
Most energy suppliers use online portals for almost everything, which means you can probably cancel your current plan through your supplier’s website. You may also be able to sign up for a new product through a similar online portal on a competitor’s site.
It could take up to three months to change your supplier if you’re switching energy suppliers and remaining in the same house, but this depends on where you are in the billing cycle.
Suppliers typically read your meter once every three months, so you will have to finish your current billing cycle before switching.
A smart meter might be able to expedite the process, or you can request a special meter reading if you need to change suppliers immediately.
You may have to pay a service fee to have a technician read your meter in these cases.
Finding a New Supplier
You can find a new energy supplier on your own, but it helps to have some assistance in the process. With a comparison tool, you can get a quick comparison of plans offered in your area.
Compare these prices and plans to your current energy plan, and you’ll be able to see whether or not you stand to save by switching. The sooner you switch, the sooner you can start saving.