Millions of Australians are being promised cheaper electricity next month, but some households could still face price hikes.
Some power bills are set to increase by 16 per cent, but Today money expert, Joel Gibson, said there are still ways to avoid it.
Millions of Australians are being promised cheaper electricity next month, but some households could still face price hikes. Getty
“This is taking people by surprise because the messaging has been government default offers are coming down, electricity wholesale prices have come down and it should be cheaper from July, but it’s not necessarily the case for everyone,” he said.
Gibson explained most households will have received a letter from their energy provider this month to explain what is happening to your rates and you can determine if you are one of those who are going to see an increase.
“There will be a sentence somewhere in that letter that should tell you how your new plan compares to what’s called the electricity reference price,” he said.
“It will say ‘your new plan is X per cent above, or Y per cent below the reference price’, that is the key sentence because you want to be below the reference price from July and ideally, 10 per cent below is I think where the best plans will land.”
Gibson said if you wait until July to see what direction your energy bill is headed, you can then switch providers if yours is one of the ones on the rise.
“People have to do work to make sure they are on the cheapest plan and they shouldn’t have to do this, some think every retailer should just put you on their cheapest plan automatically if you do nothing, but at the moment, the way the system works is if you do nothing, you get put on the most expensive plan,” he said.
“So all you have to do, once a year in July, switch on for 10-15 minutes and you can switch to one of the cheapest plans on the market by using those government websites, Energy Made Easy, Victorian Energy Compare, they list all the plans that are out there and if you once a year just lock in and have a look, that could save you hundreds of dollars a year.”
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