Do you know if the rate you’re paying to use electricity - the usage charge - is too much?

Knowing if you’re on the best price for the electricity you’re on is important, as it’s the usage charges that make up a large part of your electricity bill.

This article looks at the average usage cost per state or territory and distribution network, how it translates to your energy bill and explains how these prices are set.

What is electricity price per kWh?

The cost of using electricity is measured in kWh, which stands for Kilowatt-hours. ‘Kilo’ means 1,000, ‘watt’, is a measure of power and the ‘h’ stands for hour. This is the unit that electricity is measured and priced by. 

Most electricity providers will charge between 25 and 45 cents per kWh, but this can change depending on where you live, or the type of tariff that you are on.

Average electricity price per kWh by state?

This research from Canstar Blue shows the average usage rate per kWh, calculated for single-rate tariffs across each distribution network in NSW, VIC, south-east Queensland, South Australia, the Australian Capital Territory and Tasmania. Research is based on plans available in the Canstar Blue database. Prices are shown in cents per kWh.

State

Distribution Network

Average Electricity Usage Rate (per kWh)

NSW

Ausgrid

34.0c/kWh

NSW

Endeavour Energy

34.2c/kWh

NSW

Essential Energy

37.1c/kWh

VIC

AusNet Services

35.2c/kWh

VIC

Citipower

25.1c/kWh

VIC

Jemena

29.3c/kWh

VIC

Powercor

29.8c/kWh

VIC

United Energy

27.9/kWh

QLD

Energex

32.6c/kWh

SA

SA Power Networks

44.3c/kWh

ACT

Evoenergy

28.2c/kWh

TAS

TasNetworks

29.4c/kWh

Source: www.canstarblue.com.au – 09/07/2024. Average electricity usage rates are based on single-rate, non-solar only plans on Canstar’s database, available for an annual usage of 4,373 kWh.

Using kwH in real terms

While using the cost of kWh can be helpful in comparing electricity plans, you need to also consider factors like conditional discounts, which different energy retailers apply in a variety of ways to their plans.

The kWh cost will form just one part of your comparison when looking at energy plans. You can find each retailer’s electricity prices per kWh in their energy price fact sheets which will be available on their websites.

Single-rate tariffs will show a single kWh charge, while time of use tariffs will show multiple kWh charges depending on when electricity is used.

Who sets the electricity rate?

In Australia, energy companies set the retail prices of electricity per kWh. The prices are largely a reflection of the ‘wholesale’ price that each company pays for electricity.

Wholesale prices are what the providers pay to generators for the electricity, which is then sold on to their customers. Wholesale prices change often - every 30 minutes. 

How often do electricity rates change?

Your electricity rates change depending on what contract you’re on - standing offer, or market offer.

  • Standing offer: Guarantee by law that their electricity charges won’t increase more than once every 12 months

  • Market offer: Can have their rates adjusted whenever, as long as they are given written notice in advance.

You can also get a fixed rate plan, which guarantees one rate for a set period of time (often one or two years).

How can I find the best electricity price per kWh?

If you’re looking for a competitive electricity product, you need to consider a number of factors, such as:

  • The electricity usage rate per kWh

  • Any discounts provided

  • Any perks offered by the retailer

  • The type and length of the contract

  • If it suits your household’s electricity needs

Market offer plans come in the form of variable rate plans and fixed rate plans. On variable rate plans, the retailer can adjust rates with notice, on a fixed rate plan the retailer guarantees the rate for a specific period of usually one or two years.

Comparing electricity products is free with RateCity. Enter your postcode and review your options. To make it easier, have a copy of your most recent electricity bill at hand, so you can know for sure when you’ve found a great deal.