Making energy terms easy: A complete breakdown

At a glance

• Compare daily supply charges and usage charges (cents per kWh for electricity rates or c/MJ for gas) among different energy retailers and providers.
• Compare energy tariff structures, customer service, and green energy options.
• Check customer reviews and ratings for insights into the energy provider’s reliability and service quality.

 

Energy and electricity play a crucial role in our everyday lives, but sometimes the terminologies used in the energy industry can be confusing. Making it difficult to compare energy plans and compare energy providers in Victoria, NSW, QLD, SA, ACT and Tas.

To help you better understand the energy landscape and make informed decisions, we’ve compiled a comprehensive glossary of energy terms. Let’s dive in!

 

A

 

ACCC – Australian Competition and Consumer Commission: An independent authority responsible for promoting competition and fair trade in markets, including the energy sector, to benefit consumers.

AER – Australian Energy Regulator: The organisation that regulates and enforces compliance within the energy markets and networks in eastern and southern Australia.

Alternating Current (AC) – The flow of electricity that changes direction periodically.

Ampere (A) – A unit of electrical current representing the rate at which electricity is flowing.

Australian Energy Market Operator (AEMO) – Responsible for balancing the demand and supply of electricity by dispatching the necessary generation to meet demand.

 

B

 

Basic Plan Information Document (BPID) – A document containing key or basic information about an energy plan.

Benefit Period – The set time during which you receive a particular benefit under an energy contract. For example, a discount for the first 12 months of the contract.

 

C

 

Carbon Dioxide (CO2) – A gas released by human activities and a significant greenhouse gas.

Carbon Footprint – The total greenhouse gas emissions released by an individual or organisation’s activities.

Centrepay – A free service that lets you pay your energy bills directly from your Centrelink benefits.

Conditional Discount – A discount you may receive on your energy bill if you meet a certain condition or do what you agreed to do in the energy contract.

Consumption Charge – The cost of the electricity or gas that you use.

Controlled Load – A tariff or rate you pay for specific appliances operating during off-peak hours.

Cooling-off period – A specified period during which you can cancel a new energy contract without paying exit fees.

 

D

 

Default market offer (DMO) – The annual electricity price cap in specific regions to protect consumers on standing offers from excessive prices.

Demand Charge – An electricity plan that includes regular usage and daily supply charges, with additional demand charges based on how intensely you use electricity at a point in time.

Detailed Plan Information Document (DPID) – A document containing detailed information about an energy plan.

Distributor – An electricity or gas distributor owns the power lines, poles, and gas pipes that supply electricity and gas to your home or business.

Do Not Call Register – A service to stop telemarketers from telephoning you.

 

E

 

Electricity – The flow of electric charge generated from various sources, such as solar, wind, or fossil fuels.

Electricity Comparison – using a website to compare electricity rates to try and find the cheapest electricity supplier and best electricity prices.

Electricity Measurement – Units used to measure the amount of electricity consumed or generated.

Energy Efficiency – Minimising energy waste to achieve the same function, reducing costs and greenhouse gas emissions.

Energy ombudsman – A free and independent dispute resolution service for energy customers with unresolved issues.

Energy Rating label – A label on appliances indicating their energy efficiency.

Energy retailer – The company you pay for the gas and/or electricity you use.

Environmental, Social, and Governance (ESG) – Ethical standards to measure a company’s impact on topics such as climate change and human rights.

Exempt seller – An entity reselling electricity or gas to customers in multi-dwelling premises, generally through an embedded network.

Exit fee – A fee you might have to pay for ending your energy contract early.

 

F

 

Feed-in Tariff (FiT) – A payment made to producers of renewable energy for excess electricity they generate and feed back into the grid.

Fossil Fuel – Non-renewable fuels like coal, oil, and natural gas that release greenhouse gases when burned.

 

G

 

Gas Comparison – using a website to compare gas prices to try and find the cheapest gas provider. It can be completed separately, but consumers often compare gas and electricity to work out the best gas and electricity provider and the best gas and electric deals and prices together.

Generator – A tool that converts mechanical energy into electrical energy.

Gigawatt-Hour (GWh) – One billion (1,000,000,000) watts of electricity.

Global Climate Change – Climate change resulting from human activities, primarily burning fossil fuels.

Greenhouse Gases – Gases that absorb infrared radiation in the atmosphere, contributing to global warming and climate change.

Grid – A transmission and distribution grid-connected system that supplies electricity to customers.

Guaranteed discount – A discount that is automatically received when you sign up for an energy plan.

 

H

 

Hardship program – A program to help residential customers having difficulty paying their electricity and/or gas bills.

 

I

 

Incentive – A benefit given to a customer other than a discount.

 

K

 

Kilojoule (KJ) – A measure of gas equal to 1,000 joules.

Kilowatt (kW) – A measure of electricity equal to 1,000 watts.

Kilowatt-Hour (kWh) – A measure of electricity equal to 1,000 watt-hours.

 

L

 

Large Scale Certificate (LGC) – Certificates generated by accredited renewable energy power stations, indicating the amount of eligible renewable electricity they produce.

Liquefied Natural Gas (LNG) – Bottled gas used as a fuel source.

 

M

 

Market retail contract – A contract for electricity or gas that includes terms and conditions not included in standard contracts.

Megajoule (MJ) – A measure of gas equal to one million joules.

Megawatt (MW) – A unit of power equal to one million watts.

Megawatt-Hour (MWh) – A unit of energy equal to one million watt-hours.

Meter – A device for measuring levels and volumes of electricity or gas use.

Meter Installation Registration Number (MIRN) – A unique number assigned to your gas service by your distributor and used by your distributor and retailers to identify your connection point.

Meter reading – The process of recording the electricity and gas usage shown on meters for billing purposes.

 

N

 

National Electricity Market (NEM) – A wholesale market trading electricity between electricity producers and retailers in Australia.

Net-Zero Energy – The consumption of only as much energy as can be produced on-site through renewable sources, achieving a balance of energy use.

National Meter Identifier (NMI) – A unique number assigned to your electricity service by your distributor and used by your distributor and retailers to identify your connection point.

 

O

 

Off-Peak – Times when electricity demand is lower, typically at night, and electricity rates are cheaper.

Originator – A person or entity responsible for setting up the direct debit facility.

 

P

 

Peak Demand – The time when electricity demand is at its highest.

Photovoltaic Cell (PV) – A semiconductor that converts light directly into electricity, commonly found in solar panels.

Power Factor (PF) – The ratio of real power (kW) used to the apparent power (kVA) drawn from the network.

Power Plant – An industrial facility that generates electricity from primary energy sources.

Power Purchase Agreement (PPA) – A long-term electricity supply agreement between two parties, providing price security and other benefits.

Primary Heating Source – The primary source of heating for your home.

 

Q

 

Quarterly Billing – An energy bill that is issued every three months.

 

R

 

Reference Price – The default price set by the government to help customers compare energy offers.

Renewable Energy – Energy generated from natural processes that are continuously replenished, such as solar, wind, and hydropower.

Retailer Market Offer – An energy plan with set terms and conditions and prices.

 

S

 

Science-Based Targets Initiative (SBTi) – An initiative driving ambitious climate action in the private sector by enabling organisations to set science-based emissions reduction targets.

Solar Feed-in Tariff – The amount paid by an electricity retailer to a customer for excess solar energy fed back into the grid.

Standard contract – An energy contract with prices and conditions set by the government.

Standing offer – A default energy plan that customers are placed on if they do not have a valid contract.

 

T

 

Tariff – The price charged for energy consumption.

Thermal Energy – Energy possessed by an object or system due to the movement of particles within it.

Time of Use (TOU) – Electricity pricing varies based on the time of day and demand levels.

Transmission Lines – Steel towers and wires that carry electricity from power plants to homes and businesses.

 

U

 

Ultrahigh Voltage Transmission (UVT) – Electricity transmission over bulk-power lines at voltages greater than 800 kilovolts.

 

V

 

Victorian Default Offer (VDO) – The annual electricity price cap in Victoria to protect consumers on standing offers from excessive prices.

Volt (V) – A unit of measurement for electric potential.

 

W

 

Watt (W) – A unit of power representing the rate at which energy is produced or consumed.

Watt-Hour (Wh) – One watt of power expended for one hour, equivalent to one-thousandth of a kilowatt-hour.

Wholesale Electricity Market – A market where electricity generators and retailers buy and sell electricity.

 

We hope this expanded glossary helps you better understand energy-related terms and empowers you to make informed decisions about your energy consumption. If you have any further questions or need clarification on any energy-related topics, feel free to reach out to us.

 

Stay energy-savvy!

 

How to read your energy bill?

If you’re looking to save on energy costs and reduce emissions, understanding your energy bill is crucial. It allows you to gauge the impact of your actions on energy usage, and when you compare energy plans and compare energy providers, it also enables you to make informed decisions for your home or business needs.

 

What’s in your energy bill?

Different energy retailers may present bills differently, but they all contain core information, including:

• Supply address or service address
• Meter number
• Energy bill start and end dates
• Amount owing, including credits, discounts, or overdue amounts
• Amount of energy consumed during the billing period

 

Tariffs and Fees:

Your energy bill consists of tariff charges for the energy provided under your contract. It may also include a separate network charge and an itemised breakdown of regulatory or service fees.

 

Understanding Your Tariff:

Your gas and electricity tariff generally have two main parts:

• Daily supply charge (fixed or service charge)
• Usage charge (variable or consumption charge)

 

Comparing Energy Plans

When comparing energy plans, pay attention to the following:

 

Daily supply charge:
Compare the daily rates or total amounts for the billing period to understand the cost of energy supply to your premises.

Usage charge:
Compare cents per kilowatt-hour (c/kWh) for electricity or cents per megajoule (c/MJ) for gas to determine the cost of energy usage.

Time-of-Use Tariffs:

Consider time-of-use tariffs if available, as they may offer different usage charges for peak, shoulder, and off-peak hours. Evaluate your home and business’s energy consumption patterns to choose the most suitable plan.

Solar PV Billing Credits and Offsets:

If your home or business has solar PV panels, your bill will reflect solar credits related to your energy consumption. Keep track of the amount of solar power exported and used on-site to optimise energy generation and usage.

 

Comparing Energy Providers

When comparing energy providers, consider factors such as:

 

Tariff structures:

Compare the daily supply charges and usage charges offered by different energy retailers and providers to find the most cost-effective option.

Customer service:

Check reviews and ratings to compare energy providers and look to ensure excellent customer support and prompt issue resolution.

Green energy options:

Check if energy providers offer renewable energy plans or carbon offset options to align with your energy sustainability goals.

Reviewing Your Contract:

Before signing up with an energy provider, review your energy contract thoroughly. Ensure the chosen energy plan meets your home or business needs and aligns with your energy consumption patterns.

 

Conclusion

 

Understanding your energy bill is crucial to managing your energy consumption and costs effectively. When you compare energy plans and energy providers, focus on tariff structures, customer service, and environmental commitments. By making informed choices, you can reduce your carbon footprint and align your home or business with sustainable energy practices.

Select and Switch can provide valuable insights to assist you in making the best decisions for your energy needs and requirements. Energy is made easy by using these insights to take control of your energy usage, reduce emissions, and find the most suitable energy plan for your business. To find the best electricity or gas rate for your home, you can also use the energy comparison tool on the Select and Switch website to compare electricity providers or the cheapest gas provider.