Learning more about energy offer types, how to compare offers, account transfers and dealing with energy marketers.
Types of offers
How much you pay for electricity or gas each quarter depends on how much energy you consumed and the tariff you are charged. The retail tariff you are charged will depend on the type of contract or offer you have with your retailer.
All retailers must offer you a standard contract at ‘standing offer prices’. These prices are set by the retailer and can be changed at any time. Details of a retailer’s standing offer are published on their website.
If you don't choose a market contract you will be supplied a standing offer contract with the retailer who has the billing rights for the site. If there is an existing connection at the site, you can be supplied by the retailer who currently supplies the site, or your preferred retailer. In either case we recommend you contact the retailer to discuss the tariff as standing offer rates may be higher than market contract rates. Standing offer rates are available on retailer websites.
When you take up a special offer or deal, you enter into a market contract with the retailer. These contracts vary between retailers and contain various terms and conditions around considerations such as the duration of the contract, discounts and any fees.
The retailer sets the price and usually reserves the right to change it at any time. All market contracts have a ten day cooling off period. Within this period, you can cancel the contract by phone or in writing without penalty.
Large market contracts for businesses
Small business customers typically consume more energy than a standard domestic customer. If they consume more than 100,000 kWh electricity per year or 1 terrajoule of gas per year they are required to enter into a ‘large market’ contract. Large market contracts do not have the consumer protections available to customers who use less energy. It is therefore important to fully understand the terms and conditions of the contract.
Energy charges on your bills
The tariff you see on your electricity or gas bill reflects the retailer’s costs of supplying the electricity or gas to you, which includes:
- the costs of purchasing wholesale electricity or gas
- the cost of transporting it through the transmission and distribution networks (network charges are set separately by the Australian Energy Regulator)
- the retail operating costs such as billing and operating call centres.
Retail tariffs include fixed and variable charges:
- The variable component is applied to the amount of electricity or gas you use. Electricity is expressed in cents per kilowatt hour (kWh) and gas in cents per megajoule (MJ). This will vary each quarter, depending on your usage.
- The supply charge is expressed in cents per day. This represents the fixed charges the retailer and network incur, (for example meter readings, maintaining the poles and wires/pipes, vegetation management, maintaining a call centre) regardless of how much energy the customer uses. Every customer pays this supply charge, even if they have consumed little or no energy.
Comparing energy offers
Comparing energy offers
Switching or comparator websites
Energy Made Easy is a free independent comparator website maintained by the Australian Energy Regulator, where you can compare offers from electricity and gas retailers.
There are a number of other commercial energy comparison websites which offer services to customers wanting to switch retailers. Many of the commercial websites do not charge a fee, however they typically receive a broker’s commission from participating energy retailers or their ‘preferred suppliers’. They do not show all retailer plans.
If you're considering using a broker, make sure you've read and understood the terms and conditions of using their service. Due to the constantly changing nature of energy products, they may not be able to guarantee that the deal they offer you is the ‘cheapest’ or the ‘best’ product the retailer currently offers.
How does the tariff compare with what you are currently paying? To do this consider:
- your type of meter (if you have a smart meter, check that the retailer offers off peak/shoulder/peak rates
- your usage patterns (eg. most of your usage is during the day in shoulder/peak periods)
- your hot water service (eg. can you take advantage of cheaper off-peak rates?)
Future tariff increases
Check which part of the rate is fixed and which is subject to change. While the retail tariff component that relates to your usage may be fixed, you will be liable to pay for any increases to the network component of your tariff (eg. the retailer is obliged to pass on annual increases to the service availability or supply charge
Check how long the contract lasts and what happens when the contract expires. Does the retailer automatically roll over the contract and if so, what rate will you be paying?
Check to see if you are able to transfer the contract to another property and if there are any fees associated with this. Note that some retailers charge a disconnection fee when customers leave a property.
Check how often you will receive a bill as this can vary between companies (from once a month to once every six months).
Check how the retailer accepts payment (eg do they offer direct debit, can you pay your bill at the post office). Note that some retailers charge a fee for payments made by credit card.
Fees and charges
Some contracts may include a range of fixed charges such as a special meter reading fee to start the contract, a monthly fee if you don’t agree to pay by direct debit, an account establishment fee and late payment fees.
Early termination fees
If you cancel a contract early, you may have to pay a fee. The fee must be specified in the terms and conditions before you agree to or sign a contract.
If you are entitled to a rebate, you should check with the retailer about how this is paid. The rebate can be paid quarterly, annually or every six months and this may affect your finances. If you choose to enter into a contract, check that your pension details have been applied to your account.
Glossary of terms
- Distributor: The company that owns the network and supplies electricity and/or gas to your home. The distributor is also responsible for reading your meter and providing the meter reads to your retailer, for the billing of your account.
- Green energy: Renewable or green energy is produced from sources such as the sun, wind, water and waste.
- Retailer: The company that bills you for electricity and/or gas.
- Marketer: The salesperson who contacts you on behalf of an energy retailer. They must follow the rules contained in the Marketing Code.
- Market contract: An energy supply agreement entered into between you and a retailer.
- Regulated offer: The gas or electricity contract offered by a ‘regulated retailer’* under a Standard Customer Contract. The terms and conditions of this contract were determined by IPART. These offers ceased to exist in NSW following deregulation in 2014 and customers still on these offers on 30 June 2014 were moved onto a transitional arrangement. *The energy retailer that historically supplied electricity and/or gas to a given premises and supplied electricity and/or gas if the occupant did not enter into a market contract.
- Standard retailer: The retailer responsible by law for supplying you with gas or electricity under a standard form contract.
- Standing offer: A retailer's standard retail contract for small customers. The prices for these offers are not regulated, and may be higher than more competitive discounted tariffs offered with market contracts.
It can take a few months to complete a transfer to a new retailer. This is because the transfer cannot occur until after the next scheduled meter reading.
Once the transfer is complete, you should receive a final bill from your old retailer. If you do not receive a final bill, follow up with your old retailer to avoid arrears building or debt recovery action.
If you believe your transfer is taking too long, contact your new retailer and ask why. If they are unable to help you, or you are unhappy with their response, contact EWON.
Contact your retailer immediately if you receive:
- a letter from another retailer advising that you are now their customer, or
- an unrequested ‘final account’ from your usual retailer
Sometimes accounts are transferred in error and customers can be significantly inconvenienced.
We have received complaints where customers
- have been disconnected in error when a transfer doesn't go smoothly
- cannot find out who their new retailer is
- cannot discuss their cancelled account with the new retailer due to privacy reasons
If you are unable to resolve an unwanted transfer with the new retailer or your usual retailer, contact us.
Marketing to others in your household
If someone else in your household agrees to a contract, it may mean that your existing account will be closed. If this happens without your consent, you or the person who agreed to the contract can ask for it to be cancelled. If you have problems with this, you can call EWON for help.
Advocates, carers and power of attorney
Even if you have responsibility for managing the affairs of another person, a marketer may set up a contract with that person if they consent. If you later contact the company and explain this and they decline to cancel the contract, you can call EWON for help.
Preventing energy marketing
Energy marketers in NSW must abide by the NSW Marketing Code of Conduct. For more information on the rules see Supplier Responsibilities - Energy Marketing.
Do Not Call Register
To avoid telemarketing calls you can ask to be put on the Do Not Call Register, phone 1300 792 958.
Door-to-door energy marketing
If you do not wish to receive energy offers from a retailer, contact the company and ask them not to contact you again. To avoid offers from other companies, you will need to contact each individual retailer and ask them not to market to you.
To avoid door-to-door marketers, clearly display a sign saying ‘No Marketers’. According to the NSW Marketing Code of Conduct marketers must abide by such signs. If you have a sign displayed and the energy marketer visits your home, contact the company immediately or contact EWON.
Example of a 'No Marketers' sticker