By Sophie Ryan, iSelect spokesperson.
Picture this. You’re going about your day as usual when a new email pops into your inbox. No, not another bill. You open it and… gasp! You weren’t expecting it to be that high. Seem like a familiar scenario? The dreaded ‘bill shock’ is something many of us may experience around this time of the year as we power up the heater and ramp up our energy usage trying to keep warm – forgetting about the extra hit to the hip-pocket.[1]
Sadly in 2022, winter energy bills are likely to be even bigger for many households, as retailers hike power prices as they navigate a volatile wholesale market.[2] Maybe you’ve already taken some steps around your home to reduce energy consumption in preparation for a higher bill, but there are a few things you likely haven’t thought about that could also help you save money. Read on as we detail 3 ways that could help you avoid winter energy ‘bill shock’ that might surprise you.
1. Shopping around could still pay off, even when there are fewer options available
Over the last few months, we’ve seen some energy retailers (especially the smaller ones) encourage their customers to leave them behind and find a better deal, while some are no longer accepting new customers.[3] While there are fewer options out there in terms of both plans and providers, there could still be savings to be found by shopping around.
While prices may be higher across the board, we’re still seeing some prices differences between plans and providers so it’s important to see how your current offer stacks up because even a small price difference could make a big difference to your quarterly energy bill.
2. Remember loyalty may not pay when it comes to energy
The ‘lazy tax’ or ‘loyalty tax’ is the price Aussies could be at risk of paying if they don’t take the time to compare options and shop around.[4] If you’ve stuck with the same energy provider and plan for several years now, it’s possible you could have been automatically transferred onto a higher priced plan by your retailer. Don’t set and forget. If you can’t remember the last time you compared your energy plan, here’s a friendly reminder for you!
3. Look out for special offers & flexible payment options
Okay, so we now know why shopping around could still pay off and how to avoid the the ‘lazy tax’ or ‘loyalty tax’, but do you know about special offers and flexible payments options?
Perhaps you’re not aware that some energy retailers will offer you a better deal if you pay on time, manage your bills online or pay by direct debit. Remember though, these sorts of offers generally expire after a year or two. Also, think about ‘bill smoothing’. This is when some retailers divide your annual usage into even monthly instalments.
So there you have it, 3 ways to help you avoid winter energy ‘bill shock’ in 2022 that you might not have considered until now. If you’re still feeling unsure about where to even start or maybe you’re thinking you simply don’t have the time to take action, an energy comparison service like iSelect* can help you. Grab a copy of your latest bill and compare a range of energy plans and providers with us to see if you save money on your energy bills this winter.
*iSelect does not compare all energy providers or plans in the market. The availability of plans may change from time to time. Not all plans made available from iSelect providers are compared by iSelect and due to commercial arrangements, area or availability, not all plans compared by iSelect will be available to all customers. Some plans and special offers are available only from iSelect’s contact centre or website. Energy plans are available only for properties located in eligible areas of Victoria, New South Wales, South East Queensland, South Australia and ACT. Click here to view iSelect’s range of providers.
[1] Source: https://www.energycouncil.com.au/analysis/winter-energy-bills-avoid-a-shock/
[2] Sources: ttps://www.esc.vic.gov.au/electricity-and-gas/prices-tariffs-and-benchmarks/victorian-default-offer/victorian-default-offer-price-review-2022-23 https://www.abc.net.au/news/2022-06-18/power-price-explainer-electricity-network-bills-consumer/101162856 https://www.aer.gov.au/news-release/aer-sets-energy-price-cap-to-protect-consumers https://www.originenergy.com.au/blog/why-are-energy-prices-going-up/ https://www.energyaustralia.com.au/about-us/media/news/energyaustralia-announces-rate-changes-1-august-2022
[3]Source: Page 7, Item 2.3 of ACCC report https://www.accc.gov.au/system/files/May%202022%20report%20-%20Addendum.pdf
[4] Sources: Loyalty taxes in retail electricity markets: not as they seem? | VU Research Repository | Victoria University | Melbourne Australia & Australians are missing out on $500 million in electricity savings by failing to shop around – ABC News
