Wouldn’t it be nice if you could reduce your power bill? Find out how we saved a huge 40% off our power bill for 24 months with no lock in contract.
Understanding the Different Types of Charges on Your Power Bill
First you’ll need to get your latest electricity bill, not just the billing page, but all the pages which show the details of your household’s energy consumption. Look for the section which shows your ‘charges’. It will look something like the image below.
(I’m located in Victoria, Australia and whilst the information is specific to the region, the knowledge in understanding energy consumption is transferable.)
There are two different types of charges on an electricity bill. The first is the ‘usage’ charges – this simply means the amount of power your household has used in a given period.
Usage is measured as kWh or KiloWatt Hour. As you can see in the example the first 0 to 1140 was charged at 32.18 c/kWh (the ‘c’ stands for cents). So that means that each 1 kWh costs 32.18 cents. On a calculator you would type 1140 x .3218 which equals $366.85. That’s a lot of money and it’s only the first part of the bill!
After the first 0-1140, electricity gets more expensive. It goes from 32.18 c/kWh to 35.46 c/kWh. As above, it means that each 1 kWh (after 1141 kWh) is charged at 35.46 c/kWh.
But wait, there’s more. You also get billed a ‘supply charge’. This is a daily fee of how much you pay to your energy provider to be supplied with electricity. In the example, it’s 134.33 c/Day
It’s worthwhile taking the time to understand these terms as having a good grasp of energy literacy will help you to reduce your power bill by finding the best electricity deal by comparing providers.
Comparing Energy Providers
If you are in Victoria, it’s easy to compare energy deals by using this government website: https://compare.energy.vic.gov.au
Just for using the energy compare website, you’ll receive $50 from the Victorian government. It’s legit, I’ve done it and received $50.
If you are outside of Victoria, look online for an energy comparison website for your region.
Back to the Victorian comparison website: You can do a price comparison for both electricity and gas, residential or business. You’ll need your latest bill with your new understanding of energy charges to work your way through the questions. You’ll be asked for your average daily usage in kWh. On our bill that information is on the front page in a box titled ‘Your Usage Summary’.
Eventually you’ll get to the comparison page. Using the details above (from an actual previous bill of ours), I was able to find a much better electricity deal. My power provider was charging 32.18 c/kWh yet a different company was offering a flat rate of 19.28 c/kWh. Supply charges at 134.33 c/Day were offered at 99 c/Day. This new deal was also with no lock in contract or exit fees.
Did this make a difference? You bet, a whooping $1330 is the estimated savings over the year by changing providers. We sure did reduce our power bill.
But there is a cost to change providers. Remember the $50 the government offered you just for using the energy comparison website, well it comes in handy here because that’s the cost of changing providers.
However, there is another way where you can pocket your $50 and keep it.
Negotiate With Your Energy Provider
Print off the best deal you can find. Then ring your current energy provider and ask to speak to the ‘retention department’. Explain that you’ve used an energy comparison website and unless they can match the prices, you’ll be changing companies. The goal here is to reduce your power bill to the same rate as a comparable provider.
You’ll most likely find your current electricity provider will want to keep your business. We were able to get 40% off our electricity usage and supply charges and 38% off our gas bills for the following two years with no lock in contract – that’s a massive savings! If your current electricity provider refuses to match the deal and reduce your power bill, then take your business elsewhere.
Re-assess Your Power Bill Every Year
Remember to re-assess your electricity and gas bills every year to ensure you are always getting the best deal. We decided to re-visit these bills every winter as it’s a time of year when we spend more time inside anyway.
So far we covered how to reduce your power bill which is great for your bank balance. Yet there are still the environmental impacts of using electricity to consider. We will look further into this in another blog.
Check out my blog on Vampire Power: How to Save Money on Your Power Bill for more great energy and money saving tips.