Electricity Market Offers Exceed Safety Net - Now Is the Time to Compare Energy Plans

In lieu of the recent energy price increases, households and small businesses are being urged to check their current plan and see if there is a cheaper electricity rate available. Per the ACCC, energy prices have soared 10 to 20 per cent above the regulated safety net, which was designed to protect consumers by establishing pricing rules that limit the amount of money retailers can charge for their plans – also known as standing offer contracts. 

According to the ACCC, 90 per cent of households are on market offers, and only 10 per cent are on standing offer contracts. This means a large majority of residential customers on market offers may be paying more for electricity than those on standing offer contracts. 

Energy companies are not obligated to move customers to a standing offer contract when the price of an existing market offer contract goes higher than the safety net. This falls on the consumer alone to contact the electricity retailer and see if there is a cheaper plan option. The alternative would be to compare energy plans and find a retailer that offers a better deal. 

If you think you’re paying more for electricity, it’s possible you are. One of the easiest ways you can lower your bill is to compare energy plans and switch to a more competitive rate. Most retailers offer a benefit period that ends after a specified period (i.e. 12 months). Once this promotional period ends, you may be paying more than necessary. At Electricity Monster, we can help you potentially lower your bill by comparing rates and finding you a fair deal from our network of partnered retailers. We may also be able to apply energy concessions to your energy account at no cost to you. Click on the link below to get our best deal and a $50 voucher.

Market offers are energy plans designed by the retailer to attract customers. They can include anything from high solar feed-in tariff rates to one-off discounts. The energy retailers themselves set the prices as opposed to being set by the Australian Government, or more notably the Australian Energy Regulator (AER).

Because the energy retailer sets the price, it can offer consumers discounts, incentives, and other appealing sign-up bonuses. Keep in mind that prices can change at any time – depending on your contract – so it’s always worth checking your rate to see if you’re on the best deal. 

Another thing to consider is the benefit period for market retail offers. When your benefit period expires, you could be paying more than what you were originally paying when you signed up for the plan. 

Standing offers, or standard retail offers, are designed to be a safety net to help customers who are accustomed to one retailer get connected at a reasonable price. These types of plans are regulated by the Australian Energy Regulator (AER), which imposes limitations on what can be charged for energy. 

Standing offers will remain in effect until it is canceled by either the consumer or the retailer. If your contract expires, you may be rolled over to a standing offer, although the process varies between retailers. Unlike market offers, standing offers are not subject to discounts, so you should not expect the same one-off bonuses or incentives that retailers will normally advertise in their market offers. However, consumers can expect some sort of protection such as:

• Before a rate change can occur, retailers must notify the consumer in writing before any changes are made – which is the opposite of market offers, where prices can change at any time.
• In the case of a non-payment, the energy provider must provide the customer with certain notices and additional time to pay before disconnecting them.

If you’ve never shopped around and compared plans, there’s no better time than now to see if you can get a better deal. Staying loyal to one brand may not be the best option, as you could be paying more for electricity due to the recent increase in energy prices. As mentioned above, energy retailers are not obliged to move you to a cheaper plan so you’ll need to check and see if you’re on the best offer. 

If you have questions about your current electricity plan and want to see if you can get a better deal, we recommend calling our energy experts at Electricity Monster today. We can help you get connected fast and our service is 100% free to use.