Fixed Rate Energy Plans Explained

Fixed rate energy plans can help remove some of the guesswork involved with energy billing costs. In this guide, Canstar Blue breaks down how these kinds of plans work to help you decide if it is the right move for you. 

Power prices only seem to go one way, so whatever you can do to keep costs under control is surely worth considering. Many Australian energy providers offer headline-grabbing discounts, but discounts are only helpful in bringing costs down if you’re getting money off a competitive price in the first place.

You’ll naturally be attracted to a deal promising 10 per cent or more off your bills, but if you’re paying a higher base rate, will you really be any better off? It’s no wonder consumers often find energy plans overly-complicated and confusing. There is however, one type of energy plan that may help to take the guess work out of comparing providers and prices, as well as giving consumers a bit more certainty over bill costs. We’re talking about fixed rate (or fixed price) energy plans.

Energy retailers are currently navigating a volatile wholesale market. Some of the retailers below may have temporarily switched off their market offer plans to new customers. We will do our best to keep this table and the details on this page up to date as new information becomes available. Please check plan details and availability directly with providers.

What are fixed rate energy plans?

Fixed rate energy plans are contracts that lock-in a set price to be paid for electricity or gas usage and supply for the duration of the term, usually one or two years. The energy companies tend to review their prices every 12 months (i.e. increase/decrease them) and fixed rate products allow customers to effectively ‘beat’ the price hikes by locking in the rate they are charged.

This means that the cents per kilowatt-hour rate you pay for electricity or gas will remain unchanged for the one or two years. In most cases, your daily supply charges (what you pay just to be connected to the energy network) will also be locked in.

Fixed Rate Energy Plans by State

Now we know what fixed rate energy plans are and how they work, who actually offers them? The tables below show the current fixed rate published offers available from the providers on our database. We use a specific postcode in each state to calculate these estimated annual costs, so use our comparison tool above for specific pricing in your area. We show one product per provider, listed in order of price.

NSW

Here are some fixed rate energy plans on our database for New South Wales. These are products from referral partners†. These costs are based on the Ausgrid network in Sydney but prices may vary depending on your circumstances. This comparison assumes general energy usage of 3900kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.

VIC

Here are some fixed rate energy plans on our database for Victoria. These are products from referral partners†. These costs are based on the Citipower network in Melbourne but prices may vary depending on your circumstances. This comparison assumes general energy usage of 4000kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.

QLD

Here is some fixed rate energy plans on our database for South East Queensland. This is a product from a referral partner†. These costs are based on the Energex network in Brisbane but prices may vary depending on your circumstances. This comparison assumes general energy usage of 4600kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.

SA

Here are some fixed rate energy plans on our database for South Australia. These are products from referral partners†. These costs are based on the SA Power network in Adelaide but prices may vary depending on your circumstances. This comparison assumes general energy usage of 4000kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.

Are fixed rate plans different to fixed cost plans?

Yes, very much so. While fixed rate energy plans give customers certainty over the price they will be charged for power, they do not provide any certainty over actual costs. No household uses the exact same amount of electricity or gas every month, so the amount you need to pay will continue to vary from one billing period to the next. Fixed cost energy plans, on the other hand, provide households with a specific price to be paid every billing period, regardless of how much electricity or gas they actually use. So you can either lock-in a price, or a cost.

Who offers fixed rate and fixed cost plans?

Only a couple of electricity providers offer fixed rate plans these days, with the main contender being Origin. Other providers that also offer fixed rate plans to customers include Red Energy and Lumo Energy however, these are only in select states. Smaller retailer, Tango Energy  also offers a fixed rate plan in SA.

Fixed cost plans are a little different. While Origin has offered a fixed cost plan in the past, a handful of other retailers now offer prepaid power deals which are effectively the same thing, but with one crucial difference. In the case of prepaid power plans, retailers like Powershop allow customers to pre-purchase a specific amount of electricity to use each billing period (which means you know how much you are paying from one month to the next), however, if you go over the agree prepaid amount, you will be charged extra for your remaining usage.

What are the pros and cons of fixed rate energy plans?

Every energy plan comes with its advantages and disadvantages. Ultimately, you still need to pay for the electricity and gas you use – there’s no getting away from that. So what are the pros and cons of fixed rate energy plans?

Pros

  • A fixed rate plan means you can lock-in charges for a set period, which means if prices go up during your contract, you’ll avoid an increase to your usage or supply charges.
  • These plans can provide a small level of certainty on your energy bills, at least for the 12 to 24 months of your contract.

Cons

  • In the same way that you can avoid price hikes with a fixed rate energy offer, if prices fall during your contract term, you’ll also miss out on receiving cheaper charges on your plan.
  • Although exit fees have almost become a thing of the past, if you try to leave your fixed rate plan prior to your contract end date, you may incur an additional fee.
  • Once your fixed rate contract ends, your provider may simply move you onto its default offer, which could be significantly more expensive than your current offer.

Whether a fixed rate energy plan is the right move for you will depend entirely on your individual circumstance. While some people may find it helpful to just set and forget their rates through a fixed rate plan, others may not be too quick to jump on locked-in rates, especially if its during a period where prices look to be on a downward trend. Either way, if you’re trying to find the best deal on your electricity or gas, the best thing you can do is compare both types of offers and see which works out cheaper (or more convenient) for you.

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