Understanding your electricity bill can help you:
Common terminology
Power measured in watts (W) = how fast energy is being used, right now.
It’s a rate — like speed
Electrical Energy measured in watt-hours (Wh) = how much energy is used over time.
It’s a total — like distance
This is what you are charged for on your electricity bill.
Example: A kettle might draw 1,000 watts when switched on and takes 15 mins to boil. It has consumed 1,000 x 0.25 watt-hours.
1,000 watt-hours = 1 kilowatt-hour = 1 kWh
Your energy bill is broken down into two main types of charges:
A few electricity plans offer a Flat Energy charge rate throughout the day, however most plans now have a Time of Use (TOU) rate for different times of the day, for example:
Other charges may include:
These are fees based on the peak rate at which you draw power within a specified period, typically between 3pm to 9pm on work days in the hottest months.
Since these extra charges can be significant, check whether your current plan includes ‘capacity’ or ‘demand’ charges.
To avoid high capacity charges, take care not to run several high energy using appliances at the same time during the peak periods. For example, try not to use air conditioners together with your EV chargers and water heaters or oven.
Your electricity bill will provide you with both electricity consumption data and all charges for the period that is covers. It is helpful to look at your bills for one complete year to account for seasonal variations.
In this example, the household uses a total of 8,000 kWh per year, calculated by combining the electricity used at peak, shoulder and off peak times 2,600 + 4,000 + 1,400).
The total bill for the year is $3,229, calculated as Energy used x rate charged + supply charge
This makes the average cost per unit of electricity 42 cents/kWh ($3,331/8,000).
| Charge Name | Usage | Rate | Cost calculation | Cost |
| Peak | 2,600 kWh | 48.00 cents per kWh | = 2,600 x 48/100 | $1,248 |
| Shoulder | 4,000 kWh | 32.00 cents per kWh | = 4,000 x 32/100 | $1,280 |
| Off Peak | 1,400 kWh | 24.00 cents per kWh | = 1,400 x 24/100 | $336 |
| Supply | 365 days | 128 cents per day | = 365 x 100/100 | $467 |
| Total | $3,331 |
Based on this information, you can estimate when you are using most energy and when your costs are highest, as shown in this figure.
To obtain a more precise breakdown of your personal energy use, you can:
To estimate savings from rooftop solar, see the bottom of this page.
Shopping around to get the best electricity plan for you is a good idea, but it is often complicated to work out how different plans compare.
To help you, the Australia Energy Regulator provides a free, independent comparison of all retail offers based on your actual consumption patterns. To use it, visit the website, www.energymadeeasy.gov.au.
You will need to input your home National Metering Identifier (NMI). This is on your current electricity bill.
This is a new tariff option provided by all major Electricity Retailers that provides free electricity between 11am-2pm.
To understand how it works and whether it is right for you, visit this page to watch the video and view the slides.
A solar feed-in tariff (FIT) is the amount of money you get back from your electricity provider for the energy you put into the electricity grid. This appears as a credit on your electricity bill.
As with other rates, plans include varying FIT rates, but all have come down in recent months.
The savings from solar panels are calculated as the FIT earnings plus the value of solar energy that you consume directly within your home. Of these, the greatest value is the avoided purchases from the grid.
The quantity of self-consumption (kWh) can be estimated using data from the app that communicates with your solar inverter.
Example:
My solar panels produce 6,000 kWh of electricity over the year.
I use 50% of this directly within my home (3,000 kWh) and export 50% to the grid (3,000 kWh).
I pay 35 cents/kWh for electricity from the grid and earn 3 cents/kWh for exported electricity.
My savings this year have therefore been:
Avoided costs: 3,000 x 35/100 = $1,050
Earnings: 3,000 x 3/100 = $90
Total = $1,140
