Cheapest electricity providers in Melbourne, Victoria

Fact Checked

This Canstar Blue report helps Victorians find a cheaper plan,  comparing costs from Victoria’s five electricity distribution networks,  showing what you can expect to pay with each of them

This page also shows estimated annual bills for customers on the Citipower network in Melbourne based on the usage and supply charges (in cents per kWh) of different plans, compared to the Victorian Default Offer (VDO) as a point of reference.

Our price calculations are based on a specific postcode in Melbourne. To get a quote for your suburb, use Canstar Blue’s comparison tool here.

Our database may not cover all deals available in your area, so please check electricity retailer websites for current information.

What is the cheapest electricity provider in Melbourne, Victoria

According to the Canstar Blue database, 1st Energy, Lumo Energy and Alinta Energy currently offer the cheapest electricity plans in Victoria.

It’s worth noting, however, that electricity prices in Victoria can change frequently, so be sure to check back often.

To see what you can expect to pay from these electricity retailers, we’ve listed the cheapest plans below.

Please note, these prices are based on the Citipower network in Melbourne with a general energy usage assumption of 4000kWh/year.

In instances where one provider may have multiple cheap offers, we show only one product with the lowest price estimate first.

The Victorian Default Offer (VDO) for this area is currently $1,456/year.

1st Value (1st Energy)

Here is 1st Energy’s plan on our database for Victoria. This is a product from a referral partner†. These costs are based on the Citipower electricity 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.

Value (Lumo Energy)

Here is Lumo Energy’s plan on our database for Victoria. These costs are based on the Citipower electricity 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.

Homesaver (Alinta Energy)

Here is Alinta Energy’s plan on our database for Victoria. These costs are based on the Citipower electricity 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.

Best-Rated Electricity Providers VIC

Compare the cheapest electricity plans Melbourne, Victoria

• VIC Sponsored Plans
• VIC Plans

Here are some sponsored deals from the retailers on our database that include a link to the retailer’s website for further details. 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 and to see other products in our database that may be available. 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.

Sponsored Products

Based on the general usage^ in the Citipower network the VDO reference price is: $1,456 / year

Current FIRST Members Basic Plan Information Get $100 off your first electricity bill! Receive an additional $50 OFF your energy bill every year you have Kogan Energy & Kogan Internet. Sign up now! T&C’s Apply.

11% Less than VDO

$1,200 Price/year (estimated)

Go to Site

View all electricity plans listed on Canstar Blue

*^View important information

Here are some of the cheapest published deals from the retailers on our database that include a link to the retailer’s website for further details. These are products from referral partners†. 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 and to see other products in our database that may be available. 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.

More of the cheapest electricity deals in Melbourne, Victoria

Sometimes the cheapest possible deal isn’t the right deal for you.

That is why we’ve also listed the cheapest plans on our database for specific product types, including plans from the big three, 0% discount plans, discounted plans, plus variable rate and fixed rate plans.

These have been compared to the VDO and are in no particular order.

Cheapest Electricity Plan (No Discount) – 1st Energy, 1st Value

Here is 1st Energy’s plan on our database for Victoria. This is a product from a referral partner†. These costs are based on the Citipower electricity 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.

Cheapest Electricity Plan (Variable Rates) – 1st Energy, 1st Value

Here is 1st Energy’s plan on our database for Victoria. This is a product from a referral partner†. These costs are based on the Citipower electricity 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.

Cheapest Electricity Plan (Discounted) – Kogan Energy, Kogan Energy for current FIRST members

Here is Kogan Energy’s plan on our database for Victoria. This is a product from a referral partner†. These costs are based on the Citipower electricity 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.

Cheapest Electricity Plan (Big 3 Provider) – AGL, Residential Value Saver – New to AGL

Here is AGL’s plan on our database for Victoria. This is a product from a referral partner†. These costs are based on the Citipower electricity 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.

Cheapest Electricity Plan (Fixed Rates) – Lumo Energy, Value

Here is Lumo Energy’s plan on our database for Victoria. This is a product from a referral partner†. These costs are based on the Citipower electricity 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.

Read more: What’s cheaper: Electricity or Gas?

What about energy discounts in Victoria?

Discounts can help slash your energy bills, but they’re no longer the main point of difference when comparing energy plans.

Historically, energy retailers have offered conditional discounts, where criteria must be satisfied to be eligible for the advertised discount.

While less common, retailers sometimes offer guaranteed energy discounts, with no conditions to be met.

In light of the industry changes that took effect in July 2019, many providers have ditched their discounts in Victoria, instead focusing their efforts on providing lower base rates.

However, discounts for paying on time and paying by direct debit are still common, although some providers instead add bill credits to their energy plans as another way to attract attention.

In most cases, discounts will be applied to both usage and supply charges, though some will expire after just the first year or two.

So be aware that, if you go for a plan with a discount, you’ll have to remember to check back in with your electricity retailer once the benefit period is up.

All this information can be conveniently located on a plan’s Victorian Energy Fact Sheet (VEF).

• Expert Picks: Best Value Energy Plans in VIC

Fixed vs variable rate plans

Most of the electricity plans listed above come with variable rates, meaning the prices you are charged can be changed at any time.

That’s why it’s important to regularly review your electricity bills to make sure nothing has changed. However, some retailers also offer fixed rate plans, whereby rates are locked in for a set term and don’t change.

All the bigger providers, including Origin and AGL, used to offer fixed rate plans, but now you’ll find that only Energy Australia and a limited number of small providers still offer a fixed rate plan.

Visit our guide to fixed rate power plans if you’re interested in comparing plans with more price certainty.

Other incentives

Victorians are inundated with different incentives to try and persuade them to sign up with a particular electricity provider.

But before we look into other tempting offers, it’s important to study each plan’s tariff structure, which determines how you’ll be charged for your energy use:

• Single rate tariff: A flat rate regardless of when you use energy — this is the most common tariff in Victoria.
• Block rate tariff: One rate for the first ‘block’ of electricity, with the rate for each subsequent block increasing.
• Flexible pricing tariff: Different rates in peak, off-peak and shoulder periods.
• Time of use tariff: Different rates in peak and off-peak periods, with lower rates during off-peak periods and higher rates during peak periods. 
• Demand tariff:  Electricity supply and usage charges with an additional ‘demand’ charge.
• Controlled load tariff: Separately metered appliances, such as a hot water system, are charged a lower rate.

Retailers will also use novel incentives such as rewards programs to tempt you into a quick sign-up. For example, AGL has a rewards program called ‘AGL Rewards’ whereby customers can benefit from discounts at a range of retailers.

Other providers offer a credit on your first bill when you sign up online, usually a fairly modest $50 or $100.

While these discounts can be appealing, it’s important not to let them dictate your overall decision.

Always base your decision on an energy provider’s usage and supply charges, and what you expect to pay when the bill arrives every month or quarter.

These incentives can, nonetheless, be a very useful point of difference when comparing similar offers.

What is the cheapest electricity provider with the highest rating in Melbourne, Victoria?

Lumo Energy is the winner of our latest electricity customer satisfaction ratings.

Electricity rates in Victoria can change regularly, and as in most states, energy bills can vary by hundreds of dollars a year depending on the rates you pay.

Here is an example of the rates you can expect to find on Lumo Energy’s cheapest plan in Melbourne, VIC.

Questions to ask an energy provider before signing up

Here are some questions you should consider asking any prospective energy company:

1. Are you offering me the plan with the lowest usage rates?
2. How much are the supply charges and how do they compare to other plans?
3. How does the plan compare to the Victorian Default Offer (VDO)?
4. Is there a contract? How long is it? Are there any exit fees if I leave?
5. What discount can I get off my bill and how do I qualify for the discount?
6. What is the benefit term of the discount? Will it disappear after a year?
7. Can you offer me any additional sign-up incentives?
8. Which types of electricity tariffs are available in Victoria?

Asking the right questions will ensure that you’re always on top of the best and cheapest energy plans.

Which electricity provider is rated highest in Victoria?

It makes sense that the bottom line will decide which provider many consumers go with.

However, other factors, most notably customer service, can also prove important. Call centres are a major bugbear because there’s nothing worse than hanging on the phone for ages, trying to get a straight answer to a straight question.

The energy companies should be working hard to keep you happy, in terms of the price you pay, but also the customer service you receive.

That’s the reason why Canstar Blue produces customer satisfaction ratings for electricity providers in Victoria every year. Lumo Energy is currently rated highest overall.

If there is one message to take away from this report, it’s that regularly reviewing your electricity plan and comparing it to other offers on the market is a wise move, particularly in Victoria where the energy companies are competing hard for your business.

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Original reporting by Jared Mullane
Image Source: Gordon Bell/Shutterstock