In these times of rising living costs, every dollar saved is a dollar earned, and we understand that managing expenses is more crucial than ever. That’s why we’re bringing you a tip that could see nearly $650 return to your wallet each year with a straightforward move: switching your energy plans.
The recent research by Mozo has shed light on a significant opportunity for Australians to cut down on their energy bills. By simply comparing and changing from the average electricity and gas plans to the cheapest ones available, households could save an average of $419 on electricity and $227 on gas annually. That’s a combined saving of nearly $650 – a substantial amount that could cover a few weeks of groceries, a nice weekend getaway, or even go into your savings for a rainy day.
Energy bills are among the top financial stressors for Aussies, with about 44 per cent ranking them as a major concern. In fact, 15 per cent of Australians name energy costs as their number one worry. With the average household paying $1,242 per year for electricity and $754 for gas, based on low usage, the potential savings from switching plans are not to be ignored.
Mozo money expert Rachel Wastell has called switching retailers the ‘ultimate power play’, emphasising that it’s the best strategy to secure longer-term savings. This is particularly pertinent as the government’s $300 rebates are set to end later this year, which could lead to a spike in energy prices for many.
‘The Energy Bill Relief Fund has given households a break, but they’re also masking the reality – which is that prices are still high, and the only way to truly save in the long-term is by being savvy with your energy choices,’ Wastell said. ‘Rebates are nice, but they’re not the long-term fix. While they might seem like a quick win, they’re just a band-aid on a much bigger issue.’
The concept of a ‘loyalty tax’ is also something to be wary of. The longer you stay with your energy provider without reviewing your plan, the more you could be paying compared to what new customers are offered. The Australian Competition and Consumer Commission (ACCC) found that households who hadn’t switched electricity plans in over a year were paying $238 more annually than those on newer offers. For plans two or more years old, the excess payment jumped to an average of $317 more.
ACCC Commissioner Anna Brakey advises, ‘If you haven’t changed electricity plans in the past 12 months, chances are you are paying more for your electricity than you need to.’
So, how can you find a cheaper energy plan? Here are some tips:
- Use government comparison sites like Energy Made Easy and Victorian Energy Compare (for Victorian households) to compare your current rates.
- Don’t hesitate to call your existing retailer and ask for a better deal. They are legally required to provide this information and tell you how it compares to the government safety net price.
- Regularly check your electricity bill. Energy companies must inform you every three to four months if there is a cheaper plan available.
Remember, the savings from switching could be significant, ranging from $200 to $420 on electricity and $150 to $230 on gas annually. That’s money that could be better spent on enjoying your retirement or bolstering your savings.
Saving money on energy bills is easier than you think! Have you explored switching plans? Let us know how it worked for you in the comments!
Also read: How to save on electricity bills: Practical steps from the consumer watchdog
Even better install about 6kw of solar panels on your roof and almost eliminate your electricity bill.