Compare VIC Electricity Providers

Tango Energy takes over as best-rated electricity provider in Victoria

If you live in Melbourne, you can hardly walk around the corner without seeing some form of advertising from an energy company. Victoria is the most competitive electricity market in Australia, and the power retailers are desperate for your business – hence all those TV, radio and even billboard ads! This competition is good for consumers who like to shop around for the next best deal, but it can also make things seem extremely confusing. With so many electricity providers in Victoria – and so many sales pitches to work through – how are you going to find the right deal for you? Canstar Blue’s customer satisfaction review and ratings helps you cut through the noise and find out which providers are really doing a good job by their customers with regards to the service and tools they provide, as well as the value for money they offer.

This year, more than 2,300 electricity bill-payers in Melbourne and across Victoria have had their say on their electricity provider of choice, which have been rated on factors including bill & cost clarity, tools & advice, customer service and value for money. With so much competition between electricity companies in Victoria, the idea is to give you as much information as possible about the 13 providers compared, plus the others that operate in the state, to help you make the best decision for your needs. If you’ve always been with one of the ‘big three’ power companies – AGL, Origin and EnergyAustralia – you may find these results particularly interesting given that the research highlights a notable divide in satisfaction between customers of the big and some smaller providers.

Best-Rated VIC Electricity Providers

Canstar Blue’s 2019 review of electricity providers in Victoria saw 13 brands compared and rated in the following order for overall customer satisfaction:

• 1^st Tango Energy
• 2^nd Powershop
• 3^rd GloBird Energy
• 4^th Momentum Energy
• 5^th Alinta Energy
• 6^th Dodo Power & Gas
• 7^th Red Energy
• 8^th Simply Energy
• 9^th Lumo Energy
• 10^th EnergyAustralia
• 11^th Origin Energy
• 12^th AGL
• 13^th Click Energy

Tango Energy replaces Powershop at the top of the ratings table after its three-year spell of success. Lots of energy providers are now claiming to ‘keep things simple’ and to ‘simplify the energy industry’ but none do this quite as well as Tango Energy. The retailer has a single market offer with fairly competitive rates and no conditional discounts – you can’t get much more basic than that. And this approach is clearly winning over Victorians who have become wary of big savings claims over recent years. Powershop still performed very well this year, rated four stars overall along with GloBird Energy, Momentum Energy, Alinta Energy, Dodo, Red Energy, Simply Energy and Lumo Energy. It was three stars overall for EnergyAustralia, Origin Energy, AGL and Click Energy.

• Jump to more VIC electricity providers

Read on as we explain everything you need to know about electricity providers in Victoria, and how to get a better deal from them. But first, here is a selection of the cheapest published deals on our database.

Cheap Electricity Deals VIC

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†. 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. 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.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	EasySave No Conditional Discounts	12% LessThan VDO›	$1,173	Go to Site
Energy Fact Sheet	Simply RACV No Conditional Discounts Other Features: Price includes $150 first anniversary credit $50/year credit thereafter	11% LessThan VDO›	$1,183	Go To Site
Energy Fact Sheet	Shopper Market Offer Conditional Discounts Reduces to 10% less than VDO for purchasing the Mega Pack	17% MoreThan VDO›	$1,199 incl. conditional discount	Go To Site
Energy Fact Sheet	Online Saver Conditional Discounts Price includes $84/year bonus credit for paying on time	3% LessThan VDO›	$1,214 incl. conditional discount	Go to Site
Energy Fact Sheet	Lumo Value Conditional Discounts Reduces to 7% less than VDO for paying on time	4% Less Than VDO›	$1,237 incl. conditional discount	Go To Site
Energy Fact Sheet	No Frills No Conditional Discounts Other Features: Fixed rates for 12 months	6% LessThan VDO›	$1,249	Go to Site
View all electricity plans listed on Canstar Blue			˜›View important information

VIC Electricity Providers

Tango Energy

Tango Energy is a Melbourne-based electricity provider and the retail arm of renewable energy generation company Pacific Hydro. Tango Energy was previously branded Pacific Hydro, but its name was changed in 2018. Founded in 1992, the company was acquired by China’s State Power Investment Corporation after being floated on the ASX in 2016. When it comes to electricity retail in Australia, Tango Energy primarily operates in Victoria with a single market offer. This plan comes with fixed rates for 12 months so customers are protected from increasing costs in the short term. It does not include any conditional discounts, just competitive rates. Tango Energy is generally one of the cheapest electricity providers in Victoria and its back-to-basics approach has made it a hit with Victorian consumers.

• In its first year in our Victoria electricity provider ratings, Tango Energy has gone straight to the top – achieving five stars for its bill & cost clarity, customer service, value for money and overall satisfaction. It earned four stars for ease of sign-up and environmental sustainability, but just two stars for online tools & advice.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Home Select No Conditional Discounts Other Features: Fixed rates for 12 months	13% LessThan VDO›	$1,163	More Details
View all electricity plans listed on Canstar Blue			˜›View important information

Powershop

As well as competitive electricity prices, Powershop focuses on offering customers the helpful tools they need to monitor and act on their energy usage, including an online platform and smartphone app. Users can also log on to the Powershop website to pre-purchase power packs and take advantage of various special deals, making it unique in the Australian market. Powershop is owned by Meridian Energy – one of New Zealand’s biggest energy generators and retailers – and has a reputation for being a cheeky alternative to the more established retailers – regularly poking fun at ‘traditional’ energy company behaviour. But it has a serious side – especially when it comes to renewable energy, ranked the Greenest Energy Company in Australia by Greenpeace. When it comes to electricity plans, Powershop offers a sizeable discount off its base rates, with further savings possible by purchasing a future power pack, with offers regularly updated on the website and app.

• It may have slipped to second place in our VIC electricity ratings, but Powershop is still a popular choice for many Victorians, recording five stars for ease of sign-up, environmental sustainability, online tools & advice and customer service. It earned a respectable four stars for bill & cost clarity, value for money and overall satisfaction.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Shopper Market Offer Conditional Discounts Reduces to 10% less than VDO for purchasing the Mega Pack	17% MoreThan VDO›	$1,199 incl. conditional discount	Go To Site
Energy Fact Sheet	Powershop Lite No Conditional Discounts	2% LessThan VDO›	$1,314	Go To Site
Energy Fact Sheet	Victorian Default Offer No Conditional Discounts	Equal To VDO›	$1,334	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

GloBird Energy

GloBird Energy has emerged as one of the main ‘second tier’ challengers to Victoria’s power giants, AGL, Origin and EnergyAustralia. While some retailers promote their green credentials, helpful tools, or great customer service, GloBird Energy is all about promoting cheap prices and big savings. It mainly does this through large conditional discounts, but GloBird has also become one of several providers to launch an energy offer with low base rates, rather than relying on headline-grabbing discounts to bring costs down. In addition to supplying electricity in Victoria, GloBird Energy is also now a natural gas retailer in the state, with plans to expand to NSW in the near future. Claimed to be 100% Australian-owned, GloBird Energy is often one of the cheapest retailers around.

• GloBird Energy has done well to take third place in our VIC electricity provider ratings, with four stars for customer service, bill & cost clarity, ease of sign-up, value for money and overall satisfaction. It got just two stars for online tools & advice and environmental sustainability.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	EasySave No Conditional Discounts	12% LessThan VDO›	$1,173	Go to Site
Energy Fact Sheet	GloSave Conditional Discounts Reduces to 11% less than VDO for paying on time by direct debit	5% LessThan VDO›	$1,187 incl. conditional discount	Go to Site
Energy Fact Sheet	Vic Save Conditional Discounts Reduces to 1% more than VDO for paying on time by direct debit	2% MoreThan VDO›	$1,346 incl. conditional discount	Go to Site
View all electricity plans listed on Canstar Blue			˜›View important information

Momentum Energy

Owned by Hydro Tasmania, Momentum Energy is a champion of renewable electricity generation and was one of the first retailers to make moves to help simplify energy retail in Australia by keeping its products free from conditional discounts in an energy market where the biggest discounts didn’t always mean the biggest savings – and sticking to all the conditions can prove tricky. Melbourne-based, Momentum Energy markets itself as the electricity provider with great rates but no confusing discounts. In Victoria, Momentum has three residential market offers with varying rates but no exit fees. These include a plan targeted at renters who often move home, plus one of few solar-specific deals in Victoria that has a seemingly generous feed-in tariff. This approach seems to have its fans, with Momentum Energy rating consistently well in our VIC electricity ratings over the years.

• Taking fourth place in our latest review of Victorian electricity providers, Momentum Energy was rated four stars across all research categories.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Smile Power Flexi No Conditional Discounts	Equal To VDO›	$1,332	Go To Site
Energy Fact Sheet	Move Mate No Conditional Discounts	10% MoreThan VDO›	$1,465	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

Alinta Energy

Alinta Energy is one of the largest dual fuel energy providers in the southern states of Australia, as well as a major gas supplier in Western Australia. It also recently partnered with the Queensland government to supply homes in the Brisbane area. The retailer is headquartered in Sydney and has a strong presence in Perth, but is now owned by a Hong Kong-based conglomerate company. When it comes to electricity in Victoria, Alinta Energy has one market offer which comes with no conditional discounts, marking a change in approach from previous years. There is no fixed contract term, or exit fees. Households that also switch their natural gas with Alinta Energy could qualify for a ‘double up’ bonus in the form of sign-up credit. The retailer also recently launched its own rewards program, bringing savings on various activities such as movie tickets and eating out.

• For keeping energy markedly simple in Victoria, Alinta Energy has been ranked fifth in this year’s VIC electricity comparison. It achieved four stars for bill & cost clarity, ease of sign-up, customer service, value for money and overall satisfaction, with three stars for online tools & advice and environmental sustainability.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Real Deal No Conditional Discounts Other Features:  $100 credit off first bill	Equal To VDO›	$1,334	Go To Site
Energy Fact Sheet	Sports Pack No Conditional Discounts Other Features:  Includes a 12 month Kayo Basic subscription	Equal To VDO›	$1,334	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

Dodo Power & Gas

Perhaps best-known as a phone and internet provider, Dodo completes the set of home services by also selling electricity and natural gas. A fairly no frills retailer, Dodo operates with a single variable rate market offer in Victoria, usually competitively-priced. This is a no contract agreement, with no exit fees. But Dodo would rather have you sign up for multiple services, claiming notable savings for those who buy their energy and internet together. The Dodo brand is owned by Vocus Communications – the company behind lots of other phone and internet providers, including iPrimus. Dodo’s main selling point is that customers have the convenience of dealing with the same company for all of their home services. The problem is that it becomes harder to compare plans when you start bundling them together.

• Dodo Power & Gas was ranked sixth in our VIC electricity review, scoring a mix of four and three stars across the board. It performed quite well in regards to value for money but was let down on customer service – the two main drivers of overall satisfaction.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Market Offer No Conditional Discounts	10% LessThan VDO›	$1,200	More Details
View all electricity plans listed on Canstar Blue			˜›View important information

Red Energy

The highest-rated electricity provider in our NSW comparison, Red Energy keeps things fairly simple with three electricity market offers for prospective customers to consider. The retailer’s biggest selling point is its partnership with Qantas as two plans come with the added benefit of Qantas Frequent Flyer points for paying on time. Red Energy’s traditional offer comes with a modest 10% discount applied to both usage and supply charges, with the first Qantas deal including the 10% discount but also throwing in two points for every $1 spent on energy. The second Qantas plan bumps up the reward to seven points per $1 spent, but for this the 10% discount is lost. All plans come with variable rates but no contract term of exit fees. Red Energy’s standard plan also come with access to Red Energy Rewards, the retailer’s exclusive rewards program that can deliver discounts on various social activities, such as movie tickets, hotels and numerous other attractions. Like Lumo Energy, Red Energy is owned by renewable energy company Snowy Hydro.

• Ranked seventh this year, Red Energy rated four stars across most research categories – including ease of sign-up, customer service, value for money and environmental sustainability – but was let down on tools & advice, scoring three stars.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Living Energy Saver Conditional Discounts Equal to VDO for paying on time	11% MoreThan VDO›	$1,334 incl. conditional discount	Go To Site
Energy Fact Sheet	Qantas Red Saver Conditional Discounts Equal to VDO for paying on time Other Features: 2 Qantas Points per $1 spent on energy when bills paid on time	11% MoreThan VDO›	$1,334 incl. conditional discount	Go To Site
Energy Fact Sheet	Victorian Default Offer No Conditional Discounts	3% MoreThan VDO›	$1,374	Go To Site
Energy Fact Sheet	Qantas Red Plus No Conditional Discounts Other Features: 7 Qantas Points per $1 spent on energy when bills paid on time	11% MoreThan VDO›	$1,482	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

Simply Energy

Simply Energy is typically a very price-competitive electricity provider in Victoria, offering a range of unique products to choose from. The company is now owned by French utilities giant Engie, but remains based in Melbourne where it offers an exclusive deal for RACV members, in addition to a plan marketed at movie lovers given that it brings several free Gold Class tickets every year. Moving away from big discounts following the regulatory changes, Simply Energy’s other selling points is ‘anniversary’ credit, with two of its market offers coming with the added bonus of bill credit to market your first full year with the retailer. In the case of the RACV plan, customers will pocket a larger bill credit on the anniversary of the first year, followed by smaller credits every year thereafter. All plans come with variable rates but no lock-in contracts. Customers wishing to sign up to the RACV offer may need to prove their membership with the club.

• Coming in eighth in our VIC electricity provider ratings this year, Simply Energy earned four stars for overall satisfaction and all other research categories with the exception of three stars when it came to environmental sustainability.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Simply RACV No Conditional Discounts Other Features: Price includes $150 first anniversary credit $50/year credit thereafter	11% LessThan VDO›	$1,183	Go To Site
Energy Fact Sheet	Simply Plus No Conditional Discounts Other Features: Price includes $50 first anniversary credit	4% Less Than VDO›	$1,283	Go To Site
Energy Fact Sheet	Simply Gold Class No Conditional Discounts Other Features: 4 Gold Class movie tickets every year	Equal To VDO›	$1,333	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

Lumo Energy

Lumo Energy offers Victorians a diverse range of electricity products, including a deal targeted at renters who often move home – as it waives connection and reconnection fees – and a basic energy offering with no sign-up incentives or conditional discounts. Most Lumo Energy plans come with modest discounts for those who pay on time. All Lumo plans have variable rates, but the details may vary between products. However, one consistent theme is that conditional discounts are all applied to the whole bill, rather than usage charges alone. Another big draw to Lumo Energy is its rewards program, Lumo Ameego. With this, customers redeem discounts on a range of social activities such as movie tickets, gift cards, eating out and hotels. Lumo Energy may not be the best-rated in Victoria, but is currently ranked No.1 in our South Australia provider ratings.

• The ninth best-rated provider in our latest VIC comparison, Lumo Energy scored four stars across most research categories, but three stars on value for money and environmental sustainability.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Lumo Value Conditional Discounts Reduces to 7% less than VDO for paying on time	4% Less Than VDO›	$1,237 incl. conditional discount	Go To Site
Energy Fact Sheet	Lumo Movers Conditional Discounts Reduces to 5% less than VDO for paying on time	2% Less Than VDO›	$1,273 incl. conditional discount	Go To Site
Energy Fact Sheet	Basic No Conditional Discounts	4% Less Than VDO›	$1,276	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

EnergyAustralia

The best-rated of the big three retailers in Victoria, EnergyAustralia provides a fairly concise range of electricity products in Victoria, including two fixed rates deal that see prices locked in for 12 months. Rates vary between the plans and one includes a modest guaranteed discount applied to the whole bill. There is a third plan with no discounts or incentives which comes with VDO pricing. All this marks a notable change for EnergyAustralia which previously offered up to five different market offers in Victoria, including some large conditional discounts which expired after a year or two. This changed when new industry regulations took effect. All EnergyAustralia plans are said to be carbon neutral for customers who opt in (you’ll need to check the EA website for details). The company helpfully publishes estimated monthly costs for all its plans online so you’ll have an idea of what you’ll pay before signing up.

• EnergyAustralia was ranked 10^th in our latest VIC electricity review, scoring a mix of three and four stars across the board. It rated four stars for ease of sign-up, customer service and online tools & advice, but just three stars on value for money, bill & cost clarity and environmental sustainability.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	No Frills No Conditional Discounts Other Features: Fixed rates for 12 months	6% LessThan VDO›	$1,249	Go to Site
Energy Fact Sheet	Total Plan Home No Conditional Discounts Other Features: Fixed rates for 12 months	6% LessThan VDO›	$1,253	Go to Site
Energy Fact Sheet	Basic Home No Conditional Discounts	EqualTo VDO›	$1,334	Go to Site
View all electricity plans listed on Canstar Blue			˜›View important information

Origin Energy

Origin Energy has perhaps seen the biggest changes following the industry changes that took effect from July 2019. Previously offering one of the most diverse product ranges around, including large conditional discounts that expired after a year, Origin now promotes a much easier to understand line-up of just three plans, with no discounts to be found. The first of these is its basic plan with VDO pricing, while the other two bring modest savings off the reference price. Both coming with no contract terms or exit fees, but to get the best deal, you’ll have to set up direct debit and email billing. This plan also promotes something of a mystery bonus credit when you sign up online. Despite changes to its product range, many Origin customers will still be on one of its now retired plans. If you don’t recognise the plans list here, it might be worth giving Origin a call to discuss your options.

• Ranked 11^th out of 13 in our VIC comparison, Origin rated three stars for customer service, bill & cost clarity, environmental sustainability and overall satisfaction. It got four stars for online tools & advice and ease of sign-up, but just two stars on value for money.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Max Saver – Online Special Conditional Discounts 4% less than VDO for direct debit & eFulfilment discount Other Features: Online sign-up only	Equal To VDO>	$1,278 incl. conditional discount	More Details
Energy Fact Sheet	Max Saver Conditional Discounts 4% less than VDO for direct debit & eFulfilment discount	Equal To VDO>	$1,287 incl. conditional discount	More Details
Energy Fact Sheet	Flexi No Conditional Discounts	3% LessThan VDO>	$1,294	More Details
Energy Fact Sheet	Basic No Conditional Discounts	Equal To VDO>	$1,334	More Details
View all electricity plans listed on Canstar Blue			˜›View important information

AGL

Like Origin, energy giant AGL has undertaken a major review of its electricity plans since the introduction of the VDO, with a move away from conditional discounts, replaced by sign-up incentives instead. AGL’s offers are now the Essentials Saver and Essentials, one of which has fixed rates for 12 months, the other variable. This plan comes with an added extra of 5,000 flybuys points for signing up online, as well as access to AGL Rewards, the retailer’s loyalty programs with various value-add benefits. AGL also has specific offers for solar customers and is one of few retailers to offer specific deals for seniors.

• In our Victoria electricity provider ratings, AGL finished 12^th out of 13 with three stars for customer service, bill & cost clarity, ease of sign-up and environmental sustainability. It achieved four stars for online tools & advice, but just two stars on value for money.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Essentials Saver No Conditional Discounts	10% LessThan VDO›	$1,200	More Details
Energy Fact Sheet	Essentials No Conditional Discounts Other Features: Fixed rates for 12 months	8% LessThan VDO›	$1,226	More Details
View all electricity plans listed on Canstar Blue			˜›View important information

Click Energy

Claiming that its online business model helps keep costs low, Click Energy has been a reasonably-strong performer in our electricity provider ratings in recent years. Now owned by phone and internet provider Amaysim – now also an energy retailer – Click Energy typically provides one main market offer in Victoria, in addition to a couple of deals focussed on solar customers – appearing to offer generous feed-in tariffs. All plans come with variable rates and Click Energy has a habit of chopping and changing its main product from time to time. Once a retailer that promoted large discounts, Click Energy’s plans now come with no conditional discounts at all, although it is known for the occasional promotion that includes incentives like free gift cards.

• The lowest-ranked electricity provider in our VIC comparison this year, Click Energy got three stars for bill & cost clarity, ease of sign-up, customer service and value for money. It rated two stars for online tools & advice and environmental sustainability.

Brand	Features		Price(estimated˜)
Energy Fact Sheet	Banksia No Conditional Discounts	1% LessThan VDO›	$1,320	Go To Site
Energy Fact Sheet	Victorian Default Offer No Conditional Discounts	EqualTo VDO›	$1,334	Go To Site
View all electricity plans listed on Canstar Blue			˜›View important information

In addition to the market offers mentioned above, all energy providers have standard electricity contracts in Victoria. These are ‘default’ power plans that customers may be on if they have never switched retailers, or haven’t moved onto a new deal for several years. Standard contracts are significantly more expensive than the cheapest market offers.

List of Electricity Providers in Victoria

There are five electricity distribution networks across Victoria, with numerous energy providers operating throughout. Here is a comprehensive list of electricity providers in Victoria. Canstar Blue’s electricity comparison service includes pricing from all of these providers. Those highlighted are partnered with Canstar Blue, meaning we provide links through to their websites.

VIC Electricity Providers

• AGL
• Alinta Energy
• Amaysim Energy
• Click Energy
• Diamond Energy
• Dodo Power & Gas
• Elysian Energy
• EnergyAustralia
• Energy Locals
• GloBird Energy
• Lumo Energy
• Momentum Energy
• Origin Energy
• People Energy
• Powerdirect
• Powershop
• Red Energy
• Simply Energy
• Sumo 

Big changes to Victorian Energy Market

The Victorian energy market went through a significant change in July 2019 when tough new regulations took effect, designed to cut prices, as well as make comparing plans easier. After years of big, often dodgy discounts, retailers must now compare their discounted products to a ‘level playing field’ price called the Victorian Default Offer. The idea is that, unlike before, there is now a consistent price from which plans are compared, meaning you can have greater confidence that the plans boasting the biggest savings genuinely deliver them. At the same time, the Victorian Default Offer (VDO) acts as a price cap for customers who were previously paying the highest prices on standing offers. These customers have now been switched onto the cheaper VDO price and will be saving hundreds of dollars a year. That said, there are still many plans cheaper than the VDO, so shopping around for the best deal is still hugely important.

About the Victorian Electricity Market

Victoria is a hugely competitive market for the electricity providers – it’s where many invest the majority of their time, effort and money in order to attract new customers. This is important to know because it means that you have the power to find a better deal – provided that you’re willing to do your research and shop around. This hasn’t happened by chance or overnight. Victoria was the first Australian state to completely remove electricity price regulations in 2009, which means the energy companies are free to set their own plans and prices, with minimal legislative interference under the introduction of the VDO in 2019. Households had been able to switch providers since several years earlier, but there was little financial incentive to do so at the time.

With a fully deregulated electricity market, Victorians now have a huge range of different providers, plans and other incentives to choose from. However, with all this choice can come confusion and there is little doubt that the prospect of picking an electricity provider is a daunting one for a great many households, which is why many will still be paying more for power than they need to. The price of electricity has risen significantly in recent years, blamed in part on the closure of the Hazelwood Power Plant in Victoria back in 2017, leading many to question whether or not deregulation has been good for consumers or not. That debate will continue, but for now the key to cutting energy costs is first understanding your options – and then acting on them.

Victoria Electricity Generation & Power Stations

Victoria currently has three coal-fired power stations in operation in the Latrobe Valley, Yallourn (owned by EnergyAustralia) and Loy Yang A and B (owned by AGL). The Loy Yang power stations alone are said to power approximately 30% of Victoria’s electricity generation, although all three plants are scheduled to close in the next 20-30 years.

The Hazelwood Power Station (majority owned by Engie, the company behind retailer Simply Energy) was previously supplying around a quarter of Victoria’s base load electricity before it was closed in 2017. This means the state is now heavily reliant on its numerous gas turbine and reciprocating power stations, but with the coal-fired plants getting older and becoming less reliable, Victorians are susceptible to blackouts during periods of high demand when power reserve are stretched to the limit. More than 200,000 people were left without electricity in January 2019 as Melbourne sweltered through a 42-degree day and two of the three coal-fired plants failed.

Victoria is also home to more than a dozen solar farms, wind farms and hydroelectric power generation systems, but these can currently only meet a small percentage of the state’s overall energy demands.

Electricity Contracts in Victoria

There are two types of electricity contracts that a household in Victoria could be on – the Victorian Default Offer (VDO) or a market contract. Knowing which type you have is the first step to saving money.

• Victorian Default Offer: Introduced in July 2019, the Victorian Default Offer (VDO) has replaced standing offers as the most expensive contract that a customer who does not engage in the market can be on. The price of the VDO is determined by the Essential Services Commission (ESC) and is consistent across all retailers, unlike the previous standing offers. The introduction of the VDO saw customers on standing offers automatically switched onto the VDO price, saving many households hundreds of dollars a year.
• Market contracts: These are contracts set almost entirely by the energy retailers. They come with varying contract lengths, conditional discounts, benefit periods and fees. These are the plans that are heavily promoted by the retailers and can provide the opportunity for customers to cut costs, as long as they stick to the conditions. However, retailers must meet certain industry rules relating to how their market offers are promoted, including the fact that plans with discounts must be compared to the VDO, which also cats as a reference price for consumers to compare all plans.

It’s estimated that about one in ten households in Victoria were switched from a standing offer onto the VDO in July 2019. But while the VDO price is certainly much less than these people would previously have paid for power, Canstar Blue’s electricity database shows that customers could still save hundreds of dollars a year by switching from the VDO onto one of the cheapest market contracts, even with the same retailer. The VDO is designed to be a “fair” price for power, but that doesn’t mean you should settle for it.

Electricity Charges in Victoria

Market electricity offers in Victoria come in all sorts of shapes and sizes, but they all include two major costs – supply charges and usage charges.

• Supply charges: These are costs that households incur simply for being connected to the energy grid. Supply charges in Victoria typically cost around $1-$1.20 per day and remain the same every day no matter how much energy you use.
• Usage charges: These are the rates you’ll pay for actual electricity usage. Depending on different tariffs (which we’ll come to shortly), usage charges can vary considerably. General usage charges in Victoria can cost anywhere from 16 to 34 cents per kWh.

It’s important to look at both of these rates when comparing energy plans, but large households should pay particular attention to usage rates, while smaller households with modest energy usage should look for plans with lower daily supply costs as these will make up a higher proportion of overall costs.

Electricity Plans in Victoria

With more than 20 electricity providers competing in Victoria, you won’t be surprised to learn that there is a huge range of different plans to pick from, often differentiated by the conditional discounts and any other incentives on offer. These plans broadly fall into two categories – those which have variable rates and those with fixed rates.

• Variables rate plans: Much like having a variable rate home loan, electricity plans have variable rate usage and supply charges. This means that your provider could change the prices that you pay for electricity usage and supply at any time, as long as they give you prior notice. However, variable rate plans generally have cheaper rates than fixed rate plans.
• Fixed rate plans: If you don’t like the idea of prices changing at short notice, some energy companies have fixed rate plans. With these, you effectively lock-in supply and usage charges for a set period, usually one or two years. This means that you pay the same rates for the life of your contract, but this added convenience can come at a higher price – much like fixed rate home loans.

The vast majority of electricity plans in Victoria come with variables rates. Fixed rate plans are usually only offered by the big three energy providers, AGL, EnergyAustralia and Origin. However, Tango Energy is also known for competitive fixed rates.

Solar Plans in Victoria

The sun may not shine in Victoria as often as some other states, but more and more Victorian households are choosing to invest in solar systems. While all electricity market offers come with some form of solar feed-in tariff, there are only a handful of retailers that offer specific solar plans, usually with higher rates for solar generation. These include AGL, Origin, Click Energy, Amaysim Energy and Momentum Energy.

Electricity Discounts in Victoria

In an effort to stand out from the crowd, some electricity providers in Victoria boast market offer plans with discounts off usage charges – up to 40% or more before the industry changes that kicked in from July 2019 but much lower now. While these discounts can be a great way to cut your overall power costs, it’s important not just to assume that the providers promising the biggest discounts will automatically work out to be the cheapest, because that’s often not the case at all. Discounts will usually be applied if you:

• Pay your bills on time
• Pay bills by direct debit
• Purchase both electricity and gas from the same retailer
• Some retailers will also add an extra discount if you sign up online or receive bills via email

Discounts usually apply to electricity usage charges only, but some retailers apply their discounts to your entire bill instead. While tempting, it’s important to compare energy plans based on their base rates as well as the conditional discounts. But most importantly, you should see how the plan in question compares to the reference price that is the VDO. Failing to meet the conditions of a discount will mean you are left paying the non-discounted rate, which will be much higher. You may also be charged a fee. Also be sure to check the benefit period of your discount, because most only apply for one or two years, after which you’ll have to pay the full price.

Other Incentives

If discounts don’t really appeal to you, you will find a range of other sign-up incentives offered by the electricity retailers in Victoria in an effort to get you on board. Simply Energy and Lumo Energy both have plans that bring ‘free’ movie tickets during the life of the contract, while AGL customers can earn flybuys points and those with Red Energy can collect Qantas Frequent Flyer points. It’s also common for retailers to throw $50-$100 in sign-up credit at new customers, especially if they sign up online.

Energy Rewards Programs in Victoria

The following electricity providers offer some form of rewards program to customers in Victoria, bringing savings on various leisure and social activities, including eating out, accommodation and even theme park tickets.

• AGL (AGL Rewards)
• Alinta Energy (Alinta Energy Rewards)
• Red Energy (Red Energy Rewards)
• Lumo Energy (Lumo Ameego)
• Sumo (Sumo Perks)

Given that Victoria is one of the most competitive energy markets for the retailers, some of these rewards programs are not available in other areas.

Electricity Tariffs in Victoria

Energy tariffs are often the cause of confusion for customers, but once you know what they are and how they work, you will realise they could present an opportunity to save on bills. Put simply, ‘tariffs’ relate to the pricing structure of your energy plan, with different usage charges applying based on when you use power. Tariffs available in Victoria broadly fall into two categories:

Single Rate Tariffs

If you have a single rate tariff, you will pay the same usage charges no matter what time of day you use power – so the cost of using air conditioning, for example, will be the same whether it’s used in the early evening (peak times) or in the middle of the night (off-peak times). You might also see a single rate tariff referred to as a ‘general rate’ or ‘peak tariff’ as all electricity usage is effectively charged at peak rates.

Time of Use Tariffs

If you have a time of use tariff (also known as ‘flexible pricing’), you’ll be charged different electricity rates depending on when you use power. These rates are usually split into three categories, although the exact times in which they apply can vary between electricity distribution networks.

• Peak: These rates usually apply from the early afternoon until the late evening (e.g. 2pm-8pm). The most expensive rates you will pay, these charges can cost up to and over 50 cents per kWh.
• Off-peak: These rates apply from the late evening until the early morning (e.g. overnight from 10pm-7am) and at weekends. These charges typically cost less than 25 cents per kWh.
• Shoulder: These rates apply at all other times of day (e.g. late morning until early afternoon). Cheaper than peak rates but more expensive than off-peak rates, expect to pay around 26-32 cents per kWh.

Time of use energy tariffs are only available if your property has a smart meter. As the majority of homes in Victoria now have smart meters installed, flexible pricing is very common and can be helpful in reducing energy costs, particularly if you generally use power at off-peak times. However, picking the wrong tariff for your usage habits could prove a costly mistake. Demand tariffs – which apply an additional charge to reflect a household’s peak time usage – are also now available in Victoria.

Controlled Load Tariffs

In addition to single rate and time of use tariffs, households in Melbourne and other parts of Victoria can also benefit from a controlled load tariff (also called a dedicated circuit). A controlled load tariff is a dedicated metering connection that allows households to pay for high-usage appliances, such as hot water systems, at a cheaper rate. A dedicated circuit is usually only applied to electric water heaters, but with more than one circuit, households can also apply them to pool pumps. Controlled load tariffs are much cheaper than other charges, usually less than 25 cents per kWh. The drawback is that power will only be supplied for a few hours each day (i.e. enough time to heat water for the day or to clean your pool).

Electricity Distribution Networks in Victoria

The other factor that could impact the size of your next bill is where you live. Victoria has five different electricity distribution networks and the cost of supplying power to your home can be different depending on which network you live on. While electricity retailers are the customer-facing business, it’s the distributors who manage the infrastructure (i.e. poles and wires) that transports energy to your living room. The five electricity distributors in Victoria are:

• Citipower – servicing Melbourne city and inner suburbs
• Jemena – servicing northern and south-western suburbs
• Powercor Australia – servicing western suburbs and western Victoria
• AusNet Services – servicing outer northern and eastern suburbs, plus eastern Victoria
• United Energy Distribution – servicing southern suburbs and Mornington Peninsula

As the retailers pass on distributor costs to their customers, the suburb you live in will impact your energy costs. For example, an Origin customer living in north Melbourne would pay a different rate to an Origin customer in south Melbourne, even if they have the same product and identical usage habits. Distributor costs can account for up to 50% of your overall bill. If you are a home owner, there is nothing you can do about this, but if you are renting a home or considering where to buy, this is worth looking into. Choosing one suburb over another could save you hundreds of dollars a year in energy costs.

Who pays the most (and least) for energy in Victoria?

Given that distribution costs are passed on to the electricity providers, who then pass the costs onto their customers, it makes sense that households in the most hard-to-reach places will pay the most for power as there are more poles and wires involved in transmitting the energy to them. This is the case in Victoria where electricity customers in central parts of Melbourne (on the Citipower network) generally pay lower rates than those who live on the Powercor and AusNet networks which huge parts of regional Victoria.

To illustrate how location impacts the cost of electricity across the five distribution networks in Victoria, Canstar Blue’s electricity database listed the following prices as the cheapest deals on each network as of February 2019. These annual costs are based on typical four-person households at a selected postcode in each area:

Source: Canstar Blue electricity database February 2019.

As you can see, living in one part of Victoria could see you paying hundreds of dollars a year more than an equivalent household in another part of the state, even with the same retailer. And keep in mind that it’s not only those way out in regional Victoria that pay the highest prices – as a provider’s rates are consistent across each network, you could live on the Powercor or AusNet network in an outer suburb of Melbourne and pay significantly more than your friends in a neighbouring suburb.

Where can you find the cheapest electricity prices in Victoria?

There is no simple answer to this question because it depends on a multitude of factors, from the type of contract you have, to your discount, electricity tariffs, and where you live. But to give you an idea of where to find the cheapest energy rates in Victoria, Canstar Blue has a cost comparison page, showing plans from the providers mentioned in this report. Being the cheapest provider doesn’t automatically make them the ‘best’, but if it’s purely the bottom line you are concerned about, be sure to check out the details. Also be sure to use our comparison tool for specific offers in your area.

Questions to ask before signing up to a new plan

This report offers lots of information to help you make a better-informed decision about your electricity supply, so now it’s up to you to compare providers and plans. To make sure that you get a better deal, be sure to consider and ask the following questions:

• What type of electricity contract is it? (e.g. VDO or market contract)
• What are the supply and usage rates? (How much are you paying per kWh?)
• What different tariff options are available and how do the charges vary?
• What percentage discount is offered and what are the conditions?
• What rewards programs or other sign-up incentives are available?
• Can you add a controlled load (dedicated circuit) for water heating?

You will find the answers to these questions and more in the energy price fact sheets of each electricity provider you compare. However, these documents can be quite difficult to understand, so don’t be afraid to pick up the phone and get the answers you need. It’s also a good idea to contact your existing provider and ask if your current deal is the best they can offer. Remember that the electricity providers should be working hard to keep you happy, so if you’re not completely satisfied with the price you’re paying or the servicing you’re receiving, you now know what you can do about it.

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