How to Tell If You're on a Good Electricity Plan (Without Switching Yet)

Most guides about electricity plans end with "compare and switch." That's useful advice, but it skips a step that many households want to take first: working out whether their current plan is actually a problem before going through the process of changing it.

This article gives you a way to evaluate your current plan using information that's already on your bill — no comparison tool required to get started, though you'll want one once you've done the assessment.

Start With the Reference Price Comparison

Every electricity retailer in Australia is required to display your plan's estimated annual cost as a percentage above or below the reference price on your bill and in all plan marketing material. The reference price is a regulated benchmark set annually by the Australian Energy Regulator for a representative customer in each distribution zone. It's designed precisely for this purpose: to give consumers a standardised way to compare offers.

Find this figure on your most recent bill. It will usually appear near the plan summary or the cost breakdown section and look something like: "This plan is estimated to cost 18% less than the reference price" or "12% above the reference price."

Here's how to interpret it:

• More than 10% below reference price: You're on a reasonably competitive plan. It may not be the absolute cheapest available, but you're not being significantly overcharged.
• 0–10% below reference price: You're in the middle of the market. There's likely something better available, but the gap may not be large enough to make switching urgent.
• At reference price (0%): The reference price is not a good deal — it's a regulated cap designed to prevent the worst outcomes, not to represent fair market value. Being at reference means you're probably overpaying.
• Above reference price: You're on a standing offer or an uncompetitive market offer. This is the loyalty penalty zone. Compare immediately.

Check Your Usage Rate and Supply Charge

The reference price comparison is a useful starting signal, but it's calculated on a standard usage assumption that may not match your household. The next step is to look at the actual rates on your bill.

Your bill must show two key charges:

Usage rate (cents per kWh): What you pay for each unit of electricity you consume. For flat-rate tariffs in most Australian states, a competitive rate currently sits somewhere in the range of 25–35 cents per kWh depending on your state and distribution zone. Rates significantly above this range are worth scrutinising.

Daily supply charge (cents per day): A fixed charge for being connected to the grid, regardless of how much electricity you use. This varies by network and plan but typically falls between 80 and 130 cents per day for residential customers. Very low supply charges sometimes indicate the cost has been shifted into a higher usage rate, so look at both figures together rather than in isolation.

Neither figure in isolation tells you whether your plan is good or bad — they need to be compared against what's available in your specific postcode and distribution zone. But if your usage rate is significantly above the range above, or your supply charge is notably high, that's a signal worth acting on.

Understand Your Discount Structure

Many market offer plans in Australia are structured around conditional discounts — a percentage reduction off the usage rate and sometimes the supply charge, contingent on certain customer behaviours. Paying on time, paying by direct debit, and receiving bills by email are the most common conditions.

These discounts look large in marketing — 20%, 25%, even 30% — but the percentage is applied against the plan's reference tariff, not against some universal benchmark. A 25% discount off an inflated base rate may deliver less value than a simpler plan with a lower base rate and no conditional component.

To evaluate your discount:

1. Find the conditional discount percentage on your bill or plan summary.
2. Find the base rate the discount is applied to — this should be listed in your plan's terms.
3. Calculate your effective rate: if the base usage rate is 45c/kWh and the conditional discount is 25%, your effective rate is 33.75c/kWh.
4. Compare that effective rate against competitive flat-rate plans in your area.

Also note whether you've been consistently meeting the conditions. If you've missed a payment or haven't been on direct debit, check whether you've been charged at the discounted or undiscounted rate in recent quarters.

Look at Your Contract Terms

Before concluding your current plan is worth keeping or worth leaving, check two contract-related factors:

Exit fees: Some fixed-term electricity contracts include early termination fees. If you're in a fixed term, check whether an exit fee applies and factor it into any switching calculation. A $100 exit fee is usually worth paying if the saving from switching is $200 per year — but it's worth knowing the number before you make a decision.

Rate guarantee period: If your plan includes a rate guarantee (rates won't change for a specified period), note when that period ends. Rates that are competitive today on a guaranteed plan may not be competitive when the guarantee expires. Set a reminder to review at that point.

The Two-Year Threshold

As a general rule, if you've been on the same electricity plan for more than two years without actively reviewing it, the odds are significant that you're no longer on a competitive rate. Plan terms change, introductory discounts expire, and the market moves — new offers are released regularly as retailers compete for new customers.

This doesn't mean you need to switch every year. It means a two-year mark is a reasonable trigger for a review, even if everything has seemed fine.

When to Just Compare

If you've worked through the steps above and your plan looks competitive — below reference price, reasonable usage rates, conditional discount you're consistently meeting — then you may genuinely be on a good deal. Annual reviews are still worthwhile, but you don't need to act urgently.

If any of the signals above are flashing — above reference price, high usage rate, discount you're not meeting or that has expired, plan older than two years — the next step is to compare what's actually available in your area.

Use our [comparison tool](/compare) to check current plans in your postcode against your usage profile. The assessment above tells you whether you have a problem. The comparison tells you whether there's a solution worth acting on.

Sources: Australian Energy Regulator reference price methodology and bill disclosure requirements; AER State of the Energy Market report; ACCC retail electricity pricing monitoring.