While it can seem like the cost of living in and around Melbourne is becoming unbearable, there are still ways homeowners can reduce, use wisely and save. Managing the cost of household electricity is possible when you understand the average electricity bills in Melbourne and how the costs are set. When you can see where your money is going you can make better budgeting decisions and be selective about the providers and resources you align with.
In Melbourne, the typical annual electricity expense for 2023 was approximately $1,290, which is notably lower than the national average. A big reason for this is Melbourne’s established network of gas connections for home heating and stove tops, giving residents a choice of what energy they’d prefer.
| State | Average ¢ per kWh | Annual cost |
|---|---|---|
| TAS | 26.67 | $2044 |
| ACT | 26.56 | $2004 |
| SA | 34.84 | $1742 |
| VIC | 27.29 | $1290 |
| NSW | 28.72 | $1253 |
| QLD | 21.69 | $1226 |
Data source Momentum Energy
These figures serve as a general guideline only; individual household electricity costs can vary, depending on an array of factors including household size, energy consumption habits, and the choice of electricity provider.
Electricity prices are subject to change and are influenced by various elements such as market deregulation and policy changes. Many residents remain with larger, well-known providers out of trust and convenience, but this can sometimes result in missing out on some of the cheaper market rates available from lesser-known brands. It’s really worthwhile checking your bill and taking a closer look at what you are getting for your money. Consumers who periodically review and compare their energy plans can potentially secure more financially favourable deals.
Taking control of your energy bill is a proactive step towards managing household expenses, especially if you are relying on electricity for hot water as this can make up a huge portion of your overall bill. Consumers are encouraged to regularly assess their energy usage patterns, consider the efficiency of their household appliances, and explore comparative rates amongst different energy retailers across Melbourne.
Average Electricity Usage
Electricity consumption across Melbourne varies, influenced by factors such as the current climate, mix of house and apartment living, the number of people per household as well as how big the property is and the energy efficiency level achieved. Typically, higher energy use is seen in residential areas with larger homes and greater reliance on electrical appliances, although estates with newer homes will most likely be highly energy efficient, even with a larger floor space, than older homes.
To give you a clearer picture of costs, the average monthly electricity bill for households in Victoria for late 2022 to late 2023 sits at around $84, although this varies with household size. Here’s a breakdown:
- Single-person households typically see around $75 per month.
- Two-person homes average about $102 each month.
- Larger, four-person households might expect bills of around $136 per month.
Electricity consumption patterns also shift with the household demographics and the type of dwellings. Apartments generally use less electricity than houses due to size and shared infrastructure.
Some notable trends seen across Melbourne electricity consumers are:
- Peak use of air conditioners in the summer
- Increase in heating-related consumption over Winter months
This reduces the electricity load during other seasons and helps keep Melbourne’s electricity consumption lower than some alpine areas, such as Tasmania, where high volumes of electricity are needed to combat colder temperatures all year round.
There are also patterns that emerge around average electricity costs and age. Specifically, individuals in their 30s experience higher average yearly costs around $2,029.68, while those aged 70 and above tend to have lower bills averaging $1,315.00 per year.
Household Appliances:
Appliances are significant contributors to overall electricity usage, particularly heating and cooling which can account for a major portion of average electricity bills, especially in extreme weather. Refrigerators are another energy factor as they require consistent electricity around the clock.
A key factor in saving money on your electricity bill is the energy efficiency of your appliances. Modern, energy-efficient models can substantially reduce electricity usage compared to older ones for heating, cooling, and refrigeration as well as washers, dryers and daily-use cooking appliances.
Electricity Costs
Understanding your electricity costs is thankfully straightforward although many Melbourne residents can be put off as the volume of data can look overwhelming at first glance.
Apart from the property size and number of occupants, pricing factors such as energy consumption habits, the efficiency of appliances, and provider rates play crucial roles in the final amount you’ll pay each month.
Electricity providers calculate your bills primarily on usage, which is measured in kilowatt-hours (kWh). They will multiply the amount of energy your household consumes by their set rate. As well as differences in prices between providers, the rate for electricity is inconstant throughout the year due to seasonal variations that drive up demand. Depending on how your home is set up you can see increases in electricity prices during times of extreme heat and cold as well as peak evening times, when more people are at home and solar energy is not accessible.
Aside from your kWh usage, your bill will also come with daily service fees. Again, these will vary depending on your provider.
The Victorian Default Offer is a fair price set by the Victorian government that helps in a monopoly energy market like Melbourne which is serviced by Citipower. Once the CDO rate is set, providers can increase or decrease their prices to a certain percentage around this.
The table shows some examples of different supplier price variations. These are based on general usage for homes using 4,000 kWh / year. The Victorian Default Offer is estimated to be $1,571 per year based on the single rate tariff and includes the daily supply charge.
To be competitive most suppliers offer no lock-in contracts or required renewal. While most are variable rates some companies are willing to offer guaranteed fixed rates for 12 months, or even a Netflix plan.
| Electricity Brand | Referenced Deal | Estimated yearly price |
|---|---|---|
| Powershop Australia | 24% less than VDO | $1,201 |
| GloBird Energy | 26% less than VDO | $1,168 |
| OVO Energy | 25% less than VDO | $1,185 |
| Origin | 22% less than VDO | $1,226 |
| AGL | 21% less than VDO | $1,241 |
| Alinta Energy | 22% less than VDO | $1,225 |
| Energy Locals | 12% less than VDO | $1,239 |
This table is a guide only. As these prices change frequently it’s best to check Canstar Blue for current electricity plans.
Tips for Reducing Your Bills
Electricians understand that household electricity bills are a significant part of monthly expenses and want to work with you to provide a safe and efficient energy supply to your home.
There are practical steps individuals can take to reduce their energy expenses. One of the simplest methods is to turn off appliances at the powerpoint when not in use, especially overnight or when leaving the house for the day or on holiday. This includes heating, cooling units, computers, and other electronic devices.
It may not seem like a big change, but switching to energy-efficient lighting, such as LEDs, can significantly reduce lighting costs as they use less power and have a longer lifespan. Ask your local Service Today electricians in Melbourne, how to make this a reality in your home.
Energy Audits:
If you are lost for where to start, consider getting a home energy assessment to pinpoint where the highest energy usages are occurring. Some electricity providers already have this available to homes with a smart meter using tools such as The Residential Efficiency Scorecard.
Heating and Cooling
Setting the thermostat between 18-20 degrees in the winter and 26 degrees in the summer can lead to substantial savings.
Turning off heating or cooling in unoccupied rooms or using zoned technology can help maintain household temperatures as needed.
Curtains and drapes
By properly sealing windows and using draught blockers, you can minimise heat loss in winter and stay cool during summer.
If you need help or you encounter difficulties with paying your energy bills, it’s important to know that there are support options available. Seeking assistance can provide relief and also offer guidance on how to manage energy usage better. Contact your retailer and talk about your options.
Conclusion
When it comes to assessing the average electricity bill in Melbourne, there is a vast spectrum of variations to consider, influenced by factors like household size and age demographics.
Sustainable practices play a pivotal role in potentially lowering each homeowner’s electricity expenses. Melbourne residents are encouraged to adopt energy-efficient appliances and engage in energy conservation measures, which can lead to significant reductions in their electricity bills.
With the ongoing reforms in the energy sector, Melbourne’s population stands to benefit from more competitive pricing and innovation in the supply of electricity. Energy providers continue to emerge, giving consumers a variety of choices that can be tailored to their energy usage patterns and preferences.
If you are reading this blog, then that’s a great first step. Staying informed about your options, and engaging with emerging community initiatives is a healthy start toward a more sustainable and financially feasible future for everyone.
To know if you are getting the best value for your electricity and your provider has the best service, read over your bill, periodically review your energy plan and compare the market offerings to see what else is out there.
