Working from home energy costs to add more strain on Victorians

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Victorians could be in for a nasty shock when their next energy bill drops in the mail, with Canstar Blue data suggesting that working from home could increase power costs by as much as 45%.

Based on additional electricity usage assumptions associated with spending more time indoors, the research found that a typical household bill in Victoria could rise by more than $50 per month.

Over a year, the additional energy costs incurred because of the extra use of computers, televisions, cooktops, heaters and the like, could see the average annual Victorian electricity bill increase from just under $1,500 to more than $2,100.

Canstar Blue Editor-in-Chief, Simon Downes, said the rise in power bills is another unfortunate consequence of the COVID-19 pandemic and subsequent restrictions.

“The more time you spend at home, the more energy you’re going to use, and the higher your bills will be,” he said. “While there are some things you can do to help reduce costs, it’s going to be very difficult. The reality is that most Victorians will be getting bigger bills than they’re used to, especially those with kids at home.

“These calculations are fairly conservative in regards to the additional energy usage assumptions. It would only take an extra television or two, or extra heater or two, to really see these costs get out of control. That’s why it’s hugely important that people are conscious of their energy usage around the home, otherwise that next bill could really hurt.”

Increase in energy costs due to working from home

Canstar Blue’s data experts crunched the numbers on some common appliances that have likely copped an extra workout over the past few months. It means typical electricity bills could rise by around 45%.

Monthly Cost Annual Cost
Average Bill (Pre-COVID-19) $124.17 $1,490
Average Bill (Post-COVID-19) $180.69 $2,168
Price Difference $57 $678

Source: www.canstarblue.com.au – 18/09/2020. Calculations assume an average usage cost of $0.27 per kWh based on electricity plans available in Victoria on Canstar Blue’s database. Average electricity bill in Victoria based on Canstar Blue customer satisfaction survey, January 2020. Estimate of electricity costs post-COVID based on working from home 5 days per week, with the following additional appliance usage assumptions per day: 10 hours of computer and monitor use, 10 hours of 80cm television use, 45 minutes of electricity stovetop use, 15 minutes of microwave use, 2 hours of heater use (a medium fan/radiator or small oil column heater), 2 hours of lighting use (LED downlight), 10 minutes of coffee machine use and 2 minutes of kettle use. Actual costs will vary depending on energy rates, appliance power usage and more.

How did we calculate these additional electricity costs?

We took a look at some common household appliances to work out how much extra they’ll cost to run while spending more time at home, based on some basic assumptions (e.g. using a computer 10 hours a day, five days a week). Keep in mind, these figures are estimates only and will vary based on personal circumstances.

Appliance Minutes/Hours per Day Cost per Month Cost per Year
Computer and Monitor 10 hours $8.31 $99.66
Television (80cm flat screen) 10 hours $10.80 $129.56
Electric Cooktop 45 mins $13.70 $164.44
Microwave 15 mins $2.08 $24.92
Coffee Machine 10 mins $0.85 $10.17
Kettle 2 mins $0.68 $8.13
Heater* 2 hours $19.93 $239.19
Lighting^ 2 hours $0.18 $2.19

Source: www.canstarblue.com.au – 18/09/2020. Calculations assume an average usage cost of $0.27 per kWh based on electricity plans available in Victoria in Canstar Blue’s database. *Heater kWh usage based on a medium fan/radiator or small oil column heater. ^Lighting based on LED downlight. Usage and price information is supplied for indicative purposes only. Actual costs will vary depending on electricity costs, appliance power usage, and usage by individuals.

Cheap Energy Deals in Victoria

While Victorians are using more power than ever, now’s the time to review a range of providers to find a better deal. Here are some of the best plans we have available in our database right now.

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 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. The next three tabs feature products exclusively from AGL, EnergyAustralia and Origin.

Here are the AGL Energy plans on our database for Victoria. These are products from a referral partner†. 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.

Here are the EnergyAustralia plans on our database for Victoria. These are products from a referral partner†. 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.

Here are the Origin Energy plans on our database for Victoria. These are products from a referral partner†. These costs are based on the Citipower energy 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.

How to claim energy back on tax at the end of year

If you’ve experienced an increase in utility costs due to working from home (WFH), then you may be eligible to claim some expenses back on tax. For the most part, you’ll need to:

  • Log the number of hours you’ve worked from home
  • Understand the different ways to claim electricity usage back from the ATO
  • Know your electricity usage rate

To work out how much time you’ve spent WFH, calculate the total number of days and hours over a specific period. For example, if you’ve spent 60 working days at home, and worked 7.5 hours a day, the total amount of hours WFH would be 450 hours.

There are a number of different ways to claim your energy expenses on tax, all of which we cover in our guide here.

How to save on electricity costs

Using less power will ultimately lead to lower energy costs, but for some customers, consuming less isn’t an option right now. Mr Downes explained that WFH should motivate Aussies to be mindful of the prices they’re charged for energy, and to ask their provider for assistance should they need it.

“Many people have a tendency to just accept the additional energy costs of working from home and pay their bills, but this approach could be extremely harmful to budgets if they’re already paying too much,” he said.

“As consumers, it’s now more important than ever to get in touch with your retailer to discuss your options if you’re struggling financially as a result of the pandemic. The retailers are obligated to help you pay what you owe, but the worst thing you can do is bury your head in the sand and hope the bill goes away.

“Given that many Aussies are likely to see bigger bills in the coming months, this research should serve as a timely reminder to be conscious about energy usage habits, and to maybe think about turning that TV off if it’s just there for background noise.”

Image credit: Shuang Li/Shutterstock.com

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