We’ve all been there. Your electricity company sends you a bill, you open it up and you’re immediately hit with a wall of jargon, charges and fine print.
Just working out how much you need to pay can make your brain hurt. Is it the ‘amount with discount’? ‘Amount if paid by the due date’? The ‘total current charge’? And that’s before you’ve even gotten to all those asterisks that signpost further layers of complexity and exceptions.
But understanding the jargon and knowing what each item is can help you be better informed about what you’re paying for.
Understanding the charges and tariffs on your bill
There are three main items you should look out for on your bill, and you can use these to compare electricity companies, along with the services they provide. These are:
- Feed-in tariff
- Usage charge
- Supply charge
The feed-in tariff is the rate your electricity company pays you for the solar electricity you export. This amount will appear on most bills under a heading such a ‘solar feed-in’ or ‘credits’. This is added to your bill as a credit that you can use to pay for electricity in the future.
On most energy companies’ bills there will be a charge for how much electricity you’ve used, called a consumption or usage charge. Most power companies include their ‘margin’ within this charge so the more electricity you use, the more money they make.
Another cost is the daily supply charge (sometimes called a service charge or fixed charge). The daily supply charge covers the costs associated with transporting grid electricity to your house.