ECONNEX

Electricity Tariff Structures: A Comprehensive Guide and Implications

Discover the various electricity tariff types with our comprehensive guide. Uncover the implications of each structure to make informed choices for efficient energy management.

Tariff Types

Published on 23/01/2024

By Rajesh Kumawat

Energy Comparison

Electricity and Gas Tariffs Explained

A tariff is just a specialized word for the rate of your electricity or gas – how much it costs you to use your energy. Find out what tariff you are on to help you compare and save on plans with different tariffs.

Electricity Tariffs

There are several tariffs available for electricity use and will determine how much you will pay for the usage (not a service charge – these are separate.)

Most people pay a Single rate tariff, which is one rate all day, every day. You don’t need a specialized meter to choose this tariff, so it’s much more common. Other terms: standard tariff, anytime rate, flat rate.

If you have a smart meter or an interval meter installed, you may be eligible for a Time of use tariff, which is a variable rate determined by when you use electricity.

Pricing is determined by your retailer or supplier, and is broken down into:

  • Peak: the most expensive period, charged during weekday evenings
  • Off-peak: The least expensive period, usually charged overnight on weekends
  • Shoulder: The middle-ground: it covers the time between off-peak and peak

Your retailer may also offer other flexible pricing periods – but these vary from location to location.

The last, and least common tariff is the controlled load tariff. This applies to specialized appliances that use their own meters (under-the-floor heating, electric hot water, etc.)

This tariff is a lower rate compared to general electricity rates because these devices tend to run in off-peak periods.

Gas Tariffs

Gas tariffs are not as variable as electricity tariffs, and usually come in single-rate tariffs. By most accounts, these are called “peak” rates on your bill.

However, these single rates may come in “blocks,” dependent on the season. Gas is in higher demand during winter, especially if you use gas heating. For example:

  • Peak consumption – Winter Block (30.500 MJ/day) charged at $0.052 per MJ
  • Peak consumption – Summer Block (12.500 MJ/day) charged at $0.048 per MJ

Like electricity bills, gas service charges are separate from your usage charge. To find yourself a better gas rate, compare it with Econnex.

Energy Comparison
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