July 14, 2017: How To Choose The Best Electricity Retailer

Am I getting the best deal for electricity?... Who knows?

Am I getting the best deal for electricity?… Who knows?

If you’re like me you find it difficult and frustrating to compare one electricity retailer with another. Some offer a discount if you pay on time, some if you use a certain amount of electricity. Some have one price for the first so many kWh and a higher price for any usage over that. Others have a lower price for higher usage, etc, etc. In short, they seem to deliberately make it as difficult as possible to compare one with another, probably in the hope that we’ll all just give up and stay with whatever we’ve got.

But, as most of our readers will be aware, almost all electricity retailers in Australia have recently increased their prices, some by a LOT! So shopping around for the best deal can be well worth the effort.

In our Newsletter on June 9th I wrote about a new, ethical electricity retailer called Energy Locals. I explained how I had just decided to sign up with them because their prices were very competitive and they were willing to guarantee that the price would not change for the next year (without requiring me to sign up for a lock-in contract). Well, I’m delighted to say that they’ve gone back on their word.

A few days ago I received an email from them saying that they had changed their minds and decided to change their prices after all… and they’ve lowered them. So for the next year we’ll only be paying the following (including GST):

  • 24.2c/kWh for the electricity we use (sometimes called the ‘Usage Charge’ which makes sense)
  • 90.2c/day to be connected to the grid (sometimes called the ‘Supply Charge’ just to confuse you)
  • And I’ll be receiving 12.87c/kWh for any excess solar we export to the grid (called the Feed-in Tariff or FIT).
  • (You can view their price fact sheet for Endeavour Energy Customers at this link https://energylocals.com.au/nsw-endeavour-electricity-prices-new/)

If anyone knows of a better deal I’d love to hear about it. Quite a few of my friends have joined another ‘Green’ retailer called Powershop and a quick check of their website shows their current prices to be (including GST):

  • 31.1c/kWh
  • 104.9c/day
  • and with a 12.8c/kWh FIT

So it would seem like I’m better off, however Powershop also offers an 18% discount if you sign up for their Online Saver program (whatever that is). This would drop their prices to 25.5c/kWh and 86c/day  so that’s pretty comparable to what I’m paying. But it’s not very easy to compare since it depends on how much electricity I use whether I’ll be better off or not. I’ve also heard some complaints that Powershop waited until five minutes to midnight on June 30th to announce a significant price rise for the new financial year. This deeply annoyed at least one of our readers who immediately decided to join Energy Locals instead.

One of the reasons I like and appreciate Energy Locals is that they don’t complicate their pricing with conditional discounts or different prices depending on how much energy I use, etc, etc. They tell me straight up how much I’ll pay for electricity, how much I’ll pay each day to be connected to the grid and how much they’ll pay me for my excess solar. I like that…. a LOT!

Those three numbers are the key ones to understand when you’re investigating your options for electricity suppliers. It’s no good just focusing on the lowest price per kWh or the highest FIT. You can really get stung with the other fees if you’re not careful.

For example, I received an email recently from someone with Enova Energy (which is a small, community-based and renewable-focused electricity retailer based on the north coast of NSW). They wrote to tell me how excited they were to be able to offer a 16c FIT. And yes, 16c/kWh for any excess solar I put back into the grid is an excellent price in today’s market. Only a month ago most people were only getting 6c/kWh. So a lot of people might have jumped at that offer and said, ‘Sign me up, Scotty’.

But not so fast, what about the price I have to pay for each kWh I use and the daily ‘Supply Charge’ for each day I’m connected to the grid? I emailed them back to ask those exact questions and didn’t get an answer. So I looked it up and let me tell you, it wasn’t easy to find on their website. Click here if you’d like to see their Energy Price Fact Sheet which I eventually found but I can sum it up for you as follows.

  • 31.9c/kWh (I’m paying 24.2)
  • 156.2c/day ‘Supply Charge’ (I’m paying 90.2)
  • and 16c/kWh FIT (I’m getting 12.87)

So you can see that, in spite of the high Feed-in Tariff (FIT) I would be paying much more for the energy I use and heaps more per day to be connected to the grid. Even worse than that, when you read the fine print you find that they add a 0.6% fee for bills paid by card and a 0.25c/day fee for having a smart meter. That last one I really don’t get! A smart meter saves the retailer money because they can read the meter remotely and don’t have to send out a person to fend off the dog while they read the numbers, so why are they charging more for having one?

And what about the big boys? I checked the AGL website and their Energy Price Fact Sheet for solar customers is even harder to find and more confusing. The basic numbers are:

  • 31.9c/kWh (I’m paying 24.2)
  • 92.4c/day ‘Supply Charge’ (I’m paying 90.2)
  • and 11.1c/kWh FIT (I’m getting 12.87)

At first glance I appear to be getting a much better deal however their prices are greatly complicated by the ‘Pay-on-time’ discounts they offer. If you sign up for a one year plan you can choose to get a discount of either 22% off the usage charges (so the price per kWh would be 24.8c) OR you can opt for 14% off both the usage and daily ‘Supply Charges’ (so 27c/kWh and 79.5c/day). Either way I’m probably still better off with Energy Locals and besides, I don’t want to support Australia’s biggest polluter and I don’t like the way AGL makes their billings so indecipherable.

So are you thoroughly confused and frustrated yet? I know I was before Energy Locals came along. Now I’m happy with the deal I’m getting and satisfied that I understand it. I also greatly appreciate the assistance they offer to a whole range of not-for-profit organisations. According to their website, ‘Half our profit goes to Aussie communities, charities and into new local renewable energy’. I’m not sure quite how that works since they’re a not-for-profit themselves but you get the idea. I wasn’t able to find a list of all the organisations they support but when you sign up you get to choose which one you’d like your share of the money to go to.

I might write to them and suggest that they add more information on their website about who they support and how much they have given. But the simple fact that some of my electricity bill goes to support a worthwhile cause makes me feel even better about my choice to join Energy Locals.

Just to be clear… I do not receive anything from Energy Locals (or any other supplier for that matter). For me it’s important to be able to offer unbiased advice to my clients and readers. I just like what they’re doing and their ethical and renewable energy philosophy.

So does Energy Locals offer the best deal of all the electricity retailers? I can’t say for sure and it depends on how much power you use, how much solar you export and various other factors. If any readers know of a better deal I’ll be interested to hear about it and I’ll pass on the information. Meanwhile I’m very happy with my decision to join Energy Locals and I encourage you (if you live in NSW or SE Queensland) to give them a call on 1-300-693-637 and see what they can do for you.

Fuel Saving Tips for Car Drivers

This Newsletter is already too long so next week I’ll write more about the following video. This was sent to me by one of our readers in response to last week’s Newsletter about how much I am saving by driving my Plug-in Hybrid Electric Vehicle on electricity rather than petrol. This video is about how to save fuel when driving one of those old petrol-powered cars. If that’s you, you might find this helpful.

2 comments to July 14, 2017: How To Choose The Best Electricity Retailer

  • Hello, I’d like to say thank you for writing such a fact-based review. So many customers rely on the likes of Compare the Market to do the work for them and we have noticed some very expensive offers being listed as the ‘best’ based on some arbitrary discount. I just want to clarify one point: Energy Locals is a social enterprise, not a NFP. What does that mean? It means we do aim to make a small profit but do that while using our commercial influence in the market to fight for better outcomes for customers. Our average profit per customer is between $35-45 per year and we publish a full bill breakdown on our website.

    Regards, Adrian – Founder, Energy Locals

    • admin

      Thanks for clarifying the difference between an NFP and a social enterprise.

      And thank you once again for giving us the option to buy our energy from a company that is honest and transparent as well as socially and environmentally conscious.

      Cheers, Andy

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