Electricity usage charge is the cost of consumption by a household.
It’s a good idea to understand how your usage is calculated, this might help you limit your energy usage and save money on your bills.
What is an electricity usage charge?
An electricity usage charge is also known as a ‘consumption charge’ or ‘variable charge’, meaning this is the amount you pay for each unit cost of electricity usage. It is listed as cents per kilowatt hour(c/kWh) on your bill. Most retailers charge between 25 and 40 c/kWh.
Where to find the usage charge on the bill?
This is usually on the second page or on the back of your bill. It is shown as cents per kilowatt hour(c/kWh).
Why does the bill have different usage charges?
On some bills, there are more than one usage charge, this shows all applicable tariffs and broken down into different time periods. The usage charges can be calculated in different ways, depending on your plan.
- Single rate tariff is the main tariff but is also known as anytime, peak, flat or standard rate.
- Time of use tariff includes peak, shoulder and off-peak rates.
- Controlled load tariffs are for appliances with separate metered tariffs for cheaper rates. This might be listed as off-peak charge.
Who sets electricity usage charges?
The electricity usage charges are set by retailers or by the state government. In VIC, NSW, SE QLD and SA, retailers are free to set their usage charges with other rates and terms. The electricity is purchased from the National Energy Market (NEM), then retailers add charges to cover the costs. The Goods and Services Tax (GST) is also added to electricity usage charge, plus any state-based government expenses.
In WA, NT, Tasmania and regional QLD, the charges are set by the state government due to the deregulated electricity market.
When do electricity usage rates change?
Generally, usage and rates change every 12 months in July in most areas except for Victoria which happens every January. For those under a standard contract, their electricity charges won’t increase more than once every 12 months. While those on a market offer, retailers can change their rates anytime provided they are given prior notice.
What are the current electricity usage charges?
The electricity usage charges vary from every retailer, from state to state and even within different parts of the same state.
If you’re looking for the best energy provider you should consider rates, contract terms, discounts & perks. Understanding your bill can help you decide which energy provider to choose. To compare and switch to competitive electricity and gas deals available in your area, click here
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