How to Read Your Electricity Bill (Australian Guide)

Your electricity bill tells you exactly how much energy you use, when you use it, and what you pay per unit. Understanding it is the first step to reducing it. Most Australians overpay because they are on the wrong tariff or do not realise how much specific appliances cost to run.

This guide breaks down every section of a typical Australian electricity bill so you can identify opportunities to save, whether through solar panels, a heat pump hot water system, or simply shifting when you use power.

This is the daily fee for being connected to the grid. You pay it even if you use zero electricity. It covers the cost of maintaining poles, wires, and metering infrastructure.

Typical range: $0.90-$1.50 per day ($330-$550 per year)

You cannot avoid this charge unless you go completely off-grid. It does not change based on how much electricity you use. Some retailers advertise low usage rates but have high supply charges, so always compare the total annual cost, not just the per-kWh rate.

This is what you pay for each kilowatt-hour (kWh) of electricity consumed. One kWh is roughly: running a 1,000W appliance for one hour, or a 100W light bulb for 10 hours.

Typical single-rate tariff: 25-38c/kWh depending on state and retailer

There are three tariff structures:

• Single rate (flat): Same price per kWh all day. Simplest to understand. Best if your usage is spread throughout the day.
• Time-of-use (TOU): Different rates for peak (typically 3-9pm, 35-50c/kWh), shoulder (7am-3pm and 9-10pm, 25-30c/kWh), and off-peak (10pm-7am, 15-20c/kWh). Best if you can shift heavy usage to off-peak.
• Demand tariff: A separate charge based on your peak 30-minute usage in the billing period. Penalises running many appliances simultaneously. Less common for residential.

If you have solar and are home during the day, a TOU tariff can save money because you use cheap solar during shoulder periods and avoid peak rates in the evening.

If you have solar panels, your bill shows a credit for electricity you exported to the grid. This appears as a negative line item reducing your total.

Current feed-in rates: 3-8c/kWh depending on state and retailer (see our complete state-by-state feed-in guide).

Key things to check:

• Your feed-in rate (compare with other retailers)
• Total kWh exported (if this is much higher than kWh consumed, you are exporting too much and should shift usage to daytime)
• Whether your retailer offers different feed-in rates at different times

If you have an electric storage hot water system on a dedicated circuit, it may be on a controlled load tariff. This means your distributor controls when it heats (typically overnight during off-peak hours) and charges a cheaper rate.

Controlled load rates: 15-22c/kWh (significantly cheaper than general usage)

If you switch to a heat pump hot water system, you have two options:

• Keep it on controlled load (cheap rate, but heats overnight when heat pump is less efficient in cold weather)
• Switch to general tariff with a timer set to run during the day (uses solar if you have it, and heat pump is more efficient in warmer daytime air)

Armed with your bill data, here are the highest-impact actions:

1. Install solar. A 6.6kW system reduces your bill by $1,000-$1,800/year. See solar costs for your suburb.
2. Switch to a heat pump hot water system. Saves $400-$800/year vs gas or electric storage. See heat pump costs.
3. Compare retailers. Use Energy Made Easy (energymadeeasy.gov.au) to compare plans. Switching can save $200-$500/year with zero effort.
4. Shift usage to off-peak or solar hours. Run dishwasher, washing machine, and dryer during the day (if solar) or overnight (if TOU tariff).
5. Check for concessions. Pensioners, healthcare card holders, and some low-income households are eligible for energy concessions in every state.