2016 NSW Electricity Providers Ratings
You are viewing the 2016 ratings for NSW electricity providers. Follow the link to go to the current NSW electricity providers.
Is it time you switched electricity plans? Compare electricity providers and deals in NSW with Canstar Blue’s customer satisfaction review and ratings.
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Canstar Blue research finalised December 2016, published February 2017.
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Red Energy leads the big boys in NSW electricity ratings
New South Wales has quickly become one of the most competitive energy markets in Australia, which is great news for households in the state looking to reduce their power bills. You will now find no less than 23 different energy providers in NSW, offering a wide range of plans, discounts and other incentives to entice you to switch. If you’ve been with the same electricity retailer for more than a couple of years you are almost certainly paying more than you need to. It’s time to take control of your energy costs, but if you don’t make the right move, you won’t save as much as you possibly could. So let Canstar Blue guide you through the complicated world of electricity providers to help you find a better deal.
This electricity review will provide helpful information to households throughout NSW, whether you live in suburban Sydney, the Central Coast, Newcastle, Tamworth, Wollongong, or any area in between. Amongst other things, this report will inform you about:
- The electricity providers that operate in NSW
- The different plans and offers that are available to you
- Where you can find the cheapest electricity rates in NSW
Having so many energy retailers to choose from is great for competition, but it can also make picking the best electricity provider for you extremely challenging. Canstar Blue aims to make the decision-making process a little easier by surveying bill-payers across NSW to find out how they rate their existing provider. Their feedback is reflected by the star ratings you see above, with Red Energy rated highest overall for the third year in a row. Leading the way from Origin, EnergyAustralia and AGL, Red received five-star reviews in all research categories, most notably bill clarity, range of plans, customer service and value for money.
While our customer reviews focus on the biggest electricity providers in NSW, it’s important to remember there are many more options available, which we’ll come to shortly. But first, you’ll need to understand how the NSW energy market works, otherwise you’ll probably get lost in a sea of energy company waffle and confusing offers.
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About the NSW electricity market
There may be plenty of options now, but it wasn’t long ago that households in Sydney and the rest of NSW were stuck with one of the big three energy companies – AGL, EnergyAustralia or Origin – with no other retailers able to challenge their dominance. It’s for this reason that the big three continue to hold the lion’s share of the market today – as much as 89% accordingly to the Australian Energy Regulator’s latest report. Things began to change in 2002 when the state Government introduced Full Retail Competition, meaning that smaller electricity retailers could provide alternative options for consumers. However, while Victoria lifted its pricing restrictions in 2009, and South Australia followed suit three years later, the NSW electricity market would remain regulated by the Independent Pricing and Regulatory Tribunal until 2014, so there was little or no financial incentive to switch before then. In Queensland, price regulations were only lifted in 2016.
What does deregulation mean for NSW?
Electricity price deregulation means that the power companies are free to set their own plans, prices and conditions, resulting in a plethora of new entrants into the market. The benefits of deregulation are still up for debate, but the fact is that households in the state have never had so many different options to choose from, presenting the opportunity for consumers to save if they shop around. However, in order to save, you must have at least a basic understanding of the different providers, contracts and plans available.
Electricity providers in NSW
While our customer ratings only feature the biggest energy providers in NSW, there are many more equally capable of sending you a bill every month or quarter. The electricity retailers that operate in Sydney and the surrounding areas are:
- 1st Energy
- Alinta Energy
- Blue NRG
- Click Energy
- Diamond Energy
- Dodo Power & Gas
- Energy Locals
- Enova Energy
- Mojo Power
- Momentum Energy
- Pooled Energy
- Red Energy
- Simply Energy
- Urth Energy
While some of the providers listed above are more established as business electricity retailers, such as Blue NRG and Commander, they still have at least one residential offer for residential customers in NSW.
Types of electricity contracts in NSW
The first step in saving money on electricity costs is to understand what type of energy contract you are on. There are two types of electricity contracts:
- Standard contracts: These are the old, expensive contracts that NSW households are likely to be stuck on if you haven’t switched electricity providers in recent years. They are ongoing agreements, have basic regulated conditions set out by law, and provide a choice of different payment methods. However, they do not provide any opportunity to reduce costs through discounts. Energy companies are required to offer a standing offer contract in addition to their market offers.
- Market offer contracts: These contracts have prices set out by the retailers, come with varying contracts lengths and conditions, and provide the opportunity to save through conditional discounts, such as signing up online, paying on time, paying by direct debit and receiving bills via email instead of post. Some retailers providing several different market contracts to pick from, while others have a very concise range.
Canstar Blue research shows that households could save up to $400 a year by switching from a standard contract to a market contract, even with the same energy company. If you’re not sure which type of contract you have, consult a recent bill or contact your retailer. Switching from a standard to market offer is a simple and easy way to save a significant amount, provided you’re able to stick to the terms and conditions of the discounts.
Whether you’re on a standard contract or market offer, your electricity bill will be made up of two main costs – supply charges and usage charges.
- Supply charges are what you need to pay each billing period just for being connected to the electricity grid. Unless your retailer changes its pricing, these costs remain the same every time regardless of your electricity usage.
- Usage charges are what you will pay for your actual electricity usage, meaning you could reduce your costs by paying closer attention to your major household appliances, which typically use the most energy.
For most households, usage charges will make up the majority of overall costs. However, you should still pay close attention to supply charges which can vary significantly between retailers and plans.
Daily supply charges in NSW can vary from as little as 75 cents up to around $1 per day. Keep in mind that the retailers with cheaper supply charges may make up for these by imposing slightly higher usage rates, and vice versa.
As NSW has a deregulated electricity market, you can expect usage charges to vary between different energy providers. Usage charges of around 23-24 cents per kWh are likely to be the cheapest you will find for peak time usage. However, cheaper rates are available during other times of day, which we’ll explain shortly when we talk about tariff options in NSW.
Electricity plans in NSW
The 23 electricity providers in NSW bring a wide variety of different market contracts, usually differentiated by headline discounts and other sign-up incentives, such as ‘bonus credit’ when you sign up online.
While some electricity providers offer multiple market contracts for NSW households to choose from, others have a far more concise range. Dodo Power & Gas and Alinta Energy have just one residential market offer each for NSW, while Red Energy and Momentum Energy have two, for example. The big three retailers, Origin, AGL and EnergyAustralia, provide three or four market contracts each. These could include both variable and fixed rate plans.
- Variable rate plans: These contracts have variable usage rates, meaning the amount you are charged per kWh could increase at your retailer’s discretion. While energy providers tend to review their prices just once a year, they can technically increase their rates any time they want, provided they give you prior notice. This is a good reason why you must pay attention to your bills, because price changes may simply be mentioned in your next statement.
- Fixed rate plans: These are plans with fixed usage rates for the term of the agreement, almost always two years. It effectively means you ‘lock-in’ a per kWh usage rate for the length of the contract. This protects you against any increases in charges, but you may find fixed rate plans come with higher rates in the first place as the retailer anticipates future price increases.
In addition to these types of plans, Origin also offers a ‘fixed cost’ plan for households in Sydney and the surrounding areas. Named Predictable Plan, the idea is that customers agree a set price to pay for energy usage over the course of 12 months, meaning they pay the same every billing period regardless of how much power they actually use.
There are other electricity providers also doing things a little differently in NSW. Pooled Energy, for example, offers specific electricity plans for households with swimming pools, combining its license as an energy retailer with its pool maintaining services – so you electricity retailer is also responsible for cleaning your pool! Meanwhile, Energy Locals gives customers an opportunity to donate to their favourite charity through their energy bills.
Solar plans in NSW
From January 2017, solar power customers in NSW no longer benefit from the generous feed-in tariffs provided by the Solar Bonus Scheme, meaning many households will be considering their options going forward. The good news is there are still some favourable feed-in tariffs available, even if they don’t match those previously offered. While most energy retailers in Australia offer solar options to customers, there are others which specialise in renewable power and provide a range of unique products. Urth Energy provides the only variable rate solar feed-in tariff in the country, while Diamond Energy pays up to 100 cents per kWh during periods of extremely high energy demand, for example.
Electricity discounts in NSW
To help them stand out from the crowd, most electricity plans come with headline-grabbing discounts, usually off usage charges for either paying on time, paying by direct debit, getting bills via email, or for signing up online. Discounts of more than 20% are common in NSW, and while they will help you save on the base rates of your respective plan, it’s important to know that plans with big discounts do not always result in the cheapest overall prices. Canstar Blue research in 2016 found that plans with modest discounts often work out cheaper than those boasting big savings.
Energy rebates in NSW
To help reduce costs, there are a range of different energy rebates available for households in NSW. Customers with low incomes, dependent children and certain medical conditions may be eligible for financial support towards their gas and electricity costs.
Electricity tariffs in NSW
To get the best deal on your electricity supply, you’ll need to understand how tariffs work and how they can reduce your overall costs. Some tariffs, however, will only be available when you have a smart meter installed. Tariffs available in NSW are:
- Single rate tariff: With a single rate tariff, households will pay the same usage rates regardless of when they use power. You will pay the same rate per kWh hour if you watch TV first thing in the morning as you would in the middle of the night. You can expect single rate tariff usage charges to cost around 22 to 25 cents per kWh, depending on how much power you use throughout the day. This is because the energy companies in NSW divide usage costs into ‘block rates’. You can use a single rate tariff no matter what type of smart meter you have.
- Time of use tariff: With a time of use tariff, households pay different usage rates depending on what time they use power. Days are broken into three different periods – ‘peak’, ‘off-peak’ and ‘shoulder’. Electricity is most expensive during peak times (i.e. the early evening) and then least costly during off-peak times (i.e. late at night until early in the morning). Shoulder rate costs are applied at all other times, with costs somewhere in between. In NSW, peak time costs can be as high as 50c per kWh, with off-peak rates as low as 10c. Households can only have a time of use tariff if they have a smart meter.
What are block rates?
If you have a single rate electricity tariff, you will pay the same usage rates no matter what the time of day, up to a point. This is because block rates are applied to single rate tariff usage, with households charged differently depending on how much power they actually consume. In most cases, households pay the highest prices for the first ‘block’ of power they use during the day (usually around 10 kilowatt-hours) and then less for each following block. There is usually only a marginal difference between the costs of these blocks, but they are still worth being aware of.
Regardless of whether a household has a single rate or time of use tariff, they will still be able to benefit from having a ‘controlled load’. A controlled load, or ‘dedicated circuit’ as it is often called, is effectively a separate circuit that allows you to meter selected high-usage appliances independently from the rest of your home. A controlled load will usually just be used to power the electric hot water system in your home. Prices will be much lower than normal usage rates, but are only applicable for a few hours each day (between 6 and 8). Households can also add a second controlled load with other appliances such as pool pumps. These can be applied for up to 16 hours per day, but the usage rates will be higher than the first controlled load.
Where can you find the cheapest electricity prices in NSW?
To get the cheapest possible deal for your household, you will need to take into consideration all of the factors previously mentioned, including:
- The type of contract – standard or market offer
- How much you pay in usage and supply charges per kWh
- Whether you have variable or fixed rate usage charges
- What percentage discount you receive on your bill
- Whether you have a single rate or time of use tariff
- Whether you have a controlled load for water heating
When you spell everything out like this, it’s easy to see why many consumers find the subject of energy so confusing. However, in an effort to simplify matters, Canstar Blue’s cost comparison report for electricity providers in NSW shows overall estimated prices for many of the providers mentioned in this report. Based on average energy consumption figures and pricing for single rate tariff customers on the Ausgrid network, we found customers could save as much as $300 a year by switching to the cheapest offer available. The ‘cheapest’ electricity provider doesn’t automatically mean the ‘best’, but if the bottom line is all you worry about then our report is certainly worth a look.
Electricity distribution areas in NSW
You may not realise that there are three different electricity distribution networks covering NSW. This is important because the network you live on could have an impact on your bills, with distribution costs accounting for some of your energy charges. The three distribution networks are:
- Ausgid – covering inner, northern and eastern Sydney
- Endeavour Energy – covering southern and western Sydney
- Essential Energy – covering country and regional NSW
The electricity retailers will have different costs for their plans on each network, meaning that the amount an Origin customer, for example, pays on the Ausgrid network will be different to what another Origin customer will pay on the Endeavour network, even if their plans are the same. Distributor costs can account for up to 50% of your overall bill.
As a homeowner, there is little you can do about this. However, if you’re renting a home and take energy costs very seriously, you could look into different prices before deciding which suburb to move to, because it could save you a significant amount.
How to get the best deal on electricity in NSW
Ultimately, it’s all about educating yourself on the options that are available to you. The energy retailers are required by law to publish all of their price factsheets on their websites, so use the information gathered in this report and check out the facts and figures with your own eyes. Our customer ratings also give you an insight into how the big providers in NSW are performing in the eyes of those paying the bills, so be sure to keep these details in mind too. Remember that cheapest doesn’t always mean best, but it’s a good start.
Frequently asked questions
Canstar Blue commissioned Colmar Brunton to survey 6,000 Australian adults across a range of categories to measure and track customer satisfaction. The outcomes reported are the results from customers within the survey group who live in New South Wales and pay the electricity bills in their household – in this case, 1,061 people.
Brands must have received at least 30 responses to be included. Results are comparative and it should be noted that brands receiving three stars have still achieved a satisfaction measure of at least six out of 10. Not all brands available in the market have been compared in this survey. The ratings table is first sorted by star ratings and then alphabetically. A rated brand may receive a ‘N/A’ (Not Applicable) rating if it does not receive the minimum number of responses for that criteria.