Did you know that Australian household energy consumption increases by 0.9% annually?  

That may not seem much, but with the world’s plummeting economies, inflating goods, and dwindling energy sources, saving even a little on electric bills already goes a long way. It doesn’t only help you save a few bucks but also helps Australia conserve energy, as fossil fuels (coal, oil and gas) still dominate 91% of the energy mix, impacting both the economy and the environment.

Understanding your energy bill

But before you can successfully save on your electric bill, you have to understand why there’s a need to pay for these overwhelming costs. You might ask, aren’t I just paying for the electricity and gas I use?

Nope! Bringing energy to your home costs much more than you think, and understanding these additional figures is the key to your electric bill savings. 

What is on your electric bill

  • Retail Costs

Retailers acquire energy from wholesale markets and sell it to consumers at fixed prices. So, apart from the energy supply cost, about 16% of your bill covers the retailer’s operational and marketing expenses, encompassing services such as:

  • Account and billing management
  • Customer support
  • Wholesale

Wholesale costs refer to the payments made by retailers to energy generators or power plants. Consequently, this covers a huge chunk of your electric bill (34%). 

As retailers can only estimate end-users energy demand and corresponding wholesale market prices, they charge a premium, leading to fluctuations in the energy component of your bill, either above or below the average wholesale price.

  • Network Costs

Network costs are payments to electricity and gas distributors for maintaining the infrastructure, including poles, wires, and gas pipes, that deliver energy to your home. Hence, these understandably constitute 43-50% of the bill.

  • Environmental Policy Costs

Some states have implemented environmental costs or obligations to promote climate change initiatives and pursue renewable energy targets

Understanding the breakdown of charges on your energy bill is crucial for assessing whether you’re receiving a favourable deal and negotiating for better terms.

For more information on electric bills, check out Energy Australia’s Bill Guides

Household Energy-Saving Tips 

Once you understand your energy bill, the following energy-saving tips will make more sense!

1. Turn off lights and appliances when not in use.

With the overwhelming number of lights and appliances at home, we often forget to switch them off even when not in use. Unfortunately, devices left on standby still consume energy.

 In 2000, an Australian Government-commissioned study found that each Australian household’s average annual standby and miscellaneous power usage was 86.8 watts or 760 kWh, which amounts to $200 million worth of yearly electricity.

This would surely increase in today’s time. Hence, start your energy-saving journey by unplugging your devices instead of leaving them on standby.

2. Manage your energy use.

Most of the electric bill savings efforts are really on you! So, manage your energy use wisely through these energy management steps:

  • Compare your energy usage across different years
  • Determine peak energy usage times.
  • Shift activities to non-peak hours (Certain retailer agreements may reward energy usage during off-peak hours, typically from 10 pm to 7 am)
  • Strategise your home setup and energy use based on the seasons

3. Use energy-saving LED light bulbs.

LED lights use approximately 80% less electrical power than other bulb types, resulting in a lifespan of four times longer than traditional fluorescent lights and fifty times longer than incandescent bulbs. This makes LED lights significantly more durable than traditional options.

4. Optimise your home’s heating and cooling systems.

Different seasons, different heating demands. You have to capitalise on that, as each additional degree raises your energy consumption for heating and cooling by 5% to 10%.

You can use this guide for a more efficient use of your heating and cooling systems:

  • Summer: cooling thermostat at 25-27°C
  • Winter: heating thermostat at 18-20°C 

5. Choose energy-efficient appliances

People usually go for the cheapest prices, but that shouldn’t be the case for appliances. While a low-cost washing machine may seem like a money-saving choice, its inefficient energy consumption could cost you more in the long run.

Hence, when buying products, check and compare the energy rating labels using an energy rating calculator or look for the ENERGY STAR® mark.

6. Improve home insulation

Effective home insulation cuts down unwanted heat losses and gains, reducing the cost of heating and cooling systems by about 40-50%. Specifically, you can save up for the following insulated parts:

  • 20%- ceiling
  • 20%- walls
  • 5%- floors

7. Choose retailers with the best deal

If you want immediate energy-saving results, get the best deal with your retailers!

Energy providers offer varying prices and contracts, so you must find one that can help you save more. Aspects that you should look out for are:

  • Compatibility with your usage
  • Fees (e.g. credit card, late, and exit fees)
  • Contract type
  • Payment method

Visit Energy Made Easy to compare your options.

8. Invest in off-grid energy sources.

Off-grid energy sources, like solar power, offer the chance for energy independence off the grid, marking a significant shift from fossil fuels and reducing reliance on retailers. 

Although a home solar PV system costs about  $3500 for a basic installation, it brings cost savings and free electricity during daylight hours. And if you also install a battery system, you can efficiently store solar power for nighttime usage.

Identifying Energy Hot Spots

Identifying your energy hot spots and following our energy-saving tips can also help improve your energy-saving strategies. That said, most energy consumption in a standard household is typically distributed among the following areas:

  • Heating and cooling systems (40%)
  • Refrigeration and other appliances (25%)
  • Hot water systems (22.5%)
  • Standby power and lighting (7.5%)
  • Cooking (5%)

Other possible energy hot spots at home are outdoor and entertainment setups. Once you’ve identified yours, you can start optimising your energy use by following these steps:

  1. Explore low-cost alternatives for energy-consuming areas or items
  2. Upgrade and replace household items and lighting with the most energy-efficient options. Verify these via the Energy Rating Calculator.
  3. Ensure proper instalment maintenance of new equipment and house systems by hiring level 2 electricians.

On the Lookout for Electrical Faults 

In your pursuit of electric bill savings, always put safety first. Consult licensed local electricians in whatever energy-efficient changes and instalments you want to make to your lighting, heating, or cooling systems. Improper or reckless electrical work can result in electrical faults, compromise your safety, and cause connected appliances to heat up and consume more energy.