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Network tariffs: Everything you need to know.

Electricity bills, with their network tariffs and various charges, are complicated. So, of course, it can be tempting to skip directly to the total due. 

However, if you can spare two minutes to analyse your energy bills, you can identify opportunities for saving money. And we’re here to help you do that.

Let’s start with the basics: What are network tariffs?

Network operators take on costs for supplying, maintaining and improving the “poles and wires” that deliver electricity. The amount is charged to retailers who pass the costs on to you, the consumer, in your monthly electricity bill. These charges are what we call network tariffs.

Woman reading electricity bill

Network tariffs are based on your retailer, location, and the size of your business. They are included in all electricity bills -both bundled and unbundled invoices have them. (Read about the two types of electricity invoices here.)

However, if you’re a small business, you won’t see how much the network tariff is in your bill specifically. It’s actually “bundled” together with other fixed charges in the invoice to simplify things. Generally, network tariffs will make up about 50% of a typical electricity bill.

But if you have a commercial or industrial account, the network tariff will be itemised with the additional charges.

Who sets the network tariffs?

The Australian Energy Regulatory (AER) requires electricity distributors to submit pricing proposals annually. Since 2017, the AER has determined whether a distribution company’s proposed network tariffs can be applied for the next regulatory year. This means that network tariff rates can change, depending on what the AER approves based on very detailed information from the network providers.

Can I get on a better network tariff?

YES. There’s a possibility that your site was previously put on a more expensive tariff but it may not be needed anymore. This is absolutely your chance to save!

How can I work this out? 

Firstly, you’ll need to determine your site’s energy profile and usage. This may be tricky given the complex nature of network charges. Fortunately, we can help you through this time-consuming process.

We’ll do an audit of your invoices from at least a year prior and observe your site’s electricity consumption. We check these against the current eligibility rules for network tariffs to see if you’re qualified for the better (as in lower-priced) tariffs and give you a comprehensive report. If your energy profile fits the criteria, we will be able to get you onto a better tariff.

Et voilà, savings! 

We hope this article has explained why network tariffs are on your electricity bills and why you should take a better look at your utility bills and usage. That said we understand that going through bills monthly consumes time you could be spending on growing your business.

So, why not speak to our energy experts? That way you can focus on your business and we can do the rest.

Speak to an Energy Management Consultant

Ben Walllington
0412 676 114
Madonna Ghajar
0412 046 022
Ewen Beard
0481 345 181