Electricity deals that don’t lock you in

Advertisement

Want to switch energy providers, but worried about being stuck in a contract? Canstar Blue explains how electricity contracts really work, which retailers will lock you in, and which you’re free to leave at any time.

Australians are constantly being told to shop around and find a better deal on electricity – problem is, you’re already stuck in an electricity contract… Or are you? While an agreement with your electricity company is a “contract” in every sense of the word, many customers mistakenly presume this means they can’t leave. But in most cases, you can, and without any cost.

What is a ‘lock-in’ energy contract?

Market contracts typically come with a benefit period of one or two years (the period of time that you receive any discount or fixed rates being offered), with some including exit fees that effectively mean you are locked in, unless you’re willing to pay to cancel the contract. After the discount or other benefit expires, you will remain on the contract but will no longer receive the benefit unless you renegotiate a new deal. This is how many consumers fall into the trap of paying too much.

Don’t fall into the trap of sticking with the same energy deal for several years. You will only be ‘locked in’ if the contract has fees for leaving early. These are generally referred to as ‘exit fees’, but you may previously have seen the terms ‘termination fees’ or ‘break fees’ used to describe them. You can see if your electricity deal has an exit fee by checking its electricity price fact sheet.

What is a benefit period?

Electricity market offers can include a ‘benefit period’, which may also (confusingly) be referred to as a ‘contract period’. A benefit period refers to the period of time that you receive a discount – it does not mean you are locked into a contract for this period of time. For example, a contract may have a benefit period of 12 months. This means any applicable discounts will only apply for the first year after signing up, while the contract remains ongoing. You can see examples of plans with conditional discounts with our energy comparison tool below.

Loading...

No Lock-in Contract Energy Deals

Many major electricity retailers have jumped on board the ‘no lock-in contract’ bandwagon in recent years, allowing customers to leave when they wish without (for the most part) incurring pesky exit fees. We’ve outlined some no lock-in contract plans from our database which include links to referral partners below.

Cheap Electricity Deals NSW

Here are some of the cheapest published deals from the retailers on our database that have no lock-in contracts and include a link to the retailer’s website for further details. These costs are based on the Ausgrid network in Sydney but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. See here for further information on the Reference Price, which in this comparison assumes general energy usage of 3900kWh/year, meaning the Reference Price is $1,467/year. Use our comparison tool for a specific comparison. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Brand Features Price(estimated˜)
ReAmped Logo
Basic Plan Information

ReAmped Handshake

No Conditional Discounts

19% LessThan Reference Price^^ $1,192

Go To Site
Simply Energy Logo
Basic Plan Information

Simply NRMA

No Conditional Discounts

Other Features:

  • Price includes $160 first anniversary credit
  • $60/year credit thereafter
18% LessThan Reference Price^^ $1,207 Go To Site
Sumo Power Logo
Basic Plan Information

Sumo Select

Conditional Discounts

  • 15% less than Reference Price for paying on time
Equal
To Reference Price^^
$1,246
incl. conditional discount
Go To Site
Powershop Logo
Basic Plan Information

Shopper Market Offer

Conditional Discounts

  • 15% less than Reference Price for purchasing the Mega Pack
EqualTo Reference Price^^ $1,247
incl. conditional discount
Go To Site
Energy Locals Logo
Basic Plan Information

Online Saver

Conditional Discounts

  • Price includes $84/year bonus credit for paying on time
8% LessThan Reference Price^^ $1,272
incl. conditional discount
Go To Site
EnergyAustralia Logo
Basic Plan Information

Total Plan Home

No Conditional Discounts

Other Features:

  • Fixed rates for 12 months
13% LessThan Reference Price^^ $1,280 Go to Site
View all electricity plans listed on Canstar Blue

 Cheap Electricity Deals QLD

Here are some of the cheapest published deals from the retailers on our database that have no lock-in contracts and include a link to the retailer’s website for further details. These costs are based on the Energex network in Brisbane but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. See here for further information on the Reference Price, which in this comparison assumes general energy usage of 4600kWh/year, meaning the Reference Price is $1,570/year. Use our comparison tool for a specific comparison. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Brand Features Price(estimated**)
Powershop Logo
Basic Plan Information

Shopper Market Offer

Conditional Discounts

  • Further 15% less than Reference Price for purchasing the Mega Pack
1% LessThan Reference Price^^ $1,322
incl. conditional discount
Go To Site
ReAmped Logo
Basic Plan Information

Residential Anytime

No Conditional Discounts

16% LessThan Reference Price^^ $1,323

Go To Site
Alinta Energy Logo
Basic Plan Information

No Fuss

No Conditional Discounts

14% LessThan Reference Price^^ $1,344 Go To Site
Click Logo
Basic Plan Information

Banksia

No Conditional Discounts

14% LessThan Reference Price^^ $1,354 Go To Site
LPE Logo
Basic Plan Information

Principal Rate

No Conditional Discounts

11% LessThan Reference Price^^ $1,397

Go To Site
EnergyAustralia Logo
Basic Plan Information

Total Plan Home

No Conditional Discounts

Other Features:

  • Fixed rates for 12 months
10% Less Than Reference Price^^ $1,413 Go to Site
View all electricity plans listed on Canstar Blue

Cheap Electricity Deals SA

Here are some of the cheapest published deals from the retailers on our database that have no lock-in contracts and include a link to the retailer’s website for further details. These costs are based on SA Power network in Adelaide but prices will vary depending on your circumstances. We show one product per retailer, listed in order of lowest price first. See here for further information on the Reference Price, which in this comparison assumes general energy usage of 4000kWh/year, meaning the Reference Price is $1,941/year. Use our comparison tool for a specific comparison. These are products from referral partners†. Our database may not cover all deals in your area, and please check retailer websites for up to date information.

Brand Features Price(estimated**)
Powershop Logo
Basic Plan Information

Shopper Market Offer

Conditional Discounts

  • 15% less than Reference Price for purchasing the Mega Pack
EqualTo Reference Price^^ $1,648
incl. conditional discount
Go To Site
Simply Energy Logo
Basic Plan Information

Simply RAA

No Conditional Discounts

Other Features:

  • Price includes $260 first anniversary credit
  • $60/year credit thereafter
13% LessThan Reference Price^^ $1,687 Go To Site
Alinta Energy Logo
Basic Plan Information

No Fuss

No Conditional Discounts

9% LessThan Reference Price^^ $1,771 Go To Site
Momentum Energy Logo
Basic Plan Information

Smile Power Flexi

No Conditional Discounts

9% LessThan Reference Price^^ $1,774 Go To Site
Red Energy Logo
Basic Plan Information

Easy Saver

Conditional Discounts

  • Reduces to 7% less than Reference Price for paying on time
3% MoreThan Reference Price^^ $1,796
incl. conditional discount
Go To Site
Energy Locals Logo
Basic Plan Information

Online Saver

Conditional Discounts

  • Price includes $84/year bonus credit for paying on time
2% LessThan Reference Price^^ $1,827
incl. conditional discount
Go To Site
View all electricity plans listed on Canstar Blue

Am I locked in to my energy contract?

Read the fine print

Contrary to popular belief, most electricity contracts don’t lock you in. While exit fees were common a few years ago, these days, only a few types of contracts include an exit fee for leaving a contract early. The following contracts typically come with exit fees to watch out for.

Fixed rate contracts

Customers on a fixed rate contract have their rates frozen – usually for a period of one or two years – potentially helping them to save by temporarily shielding them from rising power prices. This is different to a variable rate contract, which most Australians are on, where the retailer can change your rates at any time.

Contracts with special perks

If your electricity contract comes with ‘bonus’ perks, like movie tickets or a smart meter upgrade, then double check there aren’t any exit fees. In the case of a meter upgrade, the exit fee will usually just be the remaining installation cost.

How much does it cost to cancel a contract?

terms and conditions

Electricity contract exit fees can range between $15 and $150, though it’s more common for exit fees to sit around the $20-$30 mark. Exit fees vary between different retailers, so be sure to factor this in when comparing energy deals.

So which electricity contracts DON’T lock me in?

The vast majority of variable rate market offers do not include exit fees, meaning you’re free to switch providers and shop around for a better deal, whenever you like. If you’re not sure whether your electricity deal includes exit fees, read your energy price fact sheet to find out. If it doesn’t mention exit fees at all, that’s probably because there are none.

Where can I find an energy deal with no contract?

Most electricity providers with lock-in contracts will also have plans that do not include exit fees. There are, however, some power companies that deal exclusively in no lock-in contracts. The following energy retailers are some of those known for providing no lock-in electricity contracts.

Check our energy comparison tool for the latest information on no lock-in contract plans and to see how they stack up on price.

Is going with a lock-in contract a good idea?

The nature of the energy market means that some of the most competitive deals are only available on a lock-in contract, which includes an exit fees. This is especially true when it comes to fixed rate products, with consumers able to benefit from fixed pricing for the duration of the term. However, you should still be able to find plenty of cheap deals that do not come with exit fees – most of these come with variable rates, so you’ll have to decide what works best for you.

  • Going with a lock-in contract plan could be a good idea for customers who would rather set and forget a competitive power plan for a couple of years.
  • Going with a no lock-in contract plan could work out well for customers who are happy regularly comparing energy offers and switching when better deals come up.

Finding a good energy deal that doesn’t lock you in

Canstar Blue rates and compares about 30 electricity companies across QLD, NSW, SA and Victoria. You can use our price comparison tool to find the cheapest deal in your area, and see which products won’t lock you in with an exit fee.

Compare Electricity Plans

Share this article

News & Tips

Sign up to receive more news like this straight to your inbox

By subscribing you agree to the Canstar Privacy Policy.

Thanks for signing up!

Good things are coming your way.

Advertisement