Electricity pricing can be a complex topic, especially with the introduction of demand tariffs in Australia. This blog aims to demystify demand tariffs, explain how they differ from traditional usage charges, and provide practical tips on monitoring and managing these charges effectively.
What is a Demand Tariff?
A demand tariff is a pricing structure designed to reduce electricity usage during peak times. Unlike traditional usage charges, which are based on the total amount of electricity consumed, demand tariffs add a fee based on the highest level of electricity usage during a specific period, typically between 3 pm and 9 pm on weekdays.
How Demand Tariffs Differ from Usage Charges
Usage Charges
These are straightforward and based on the total kilowatt-hours (kWh) consumed over a billing period. The more electricity you consume, the higher your bill.
Demand Tariffs
These include a demand charge, which is calculated based on the highest 30-minute interval of electricity usage during peak times – for instance, when you are running multiple appliances at the same time.
Demand tariffs also vary. For example, you may be charged a daily rate based on your highest demand in the month, in the year, or during peak times only.
Tips to Monitor and Outsmart Demand Tariffs
- Shift High-Energy Activities:
- Laundry: Run your washing machine and dryer during off-peak hours, such as early morning or late evening.
- Dishwashing: Use your dishwasher outside of peak times or consider washing dishes by hand during these hours.
- Use Timers and Smart Plugs:
- Timers: Set timers on appliances like water heaters and pool pumps to operate during off-peak hours.
- Smart Plugs: Use smart plugs to schedule the operation of devices and appliances, ensuring they run when electricity is cheaper.
- Optimise Heating and Cooling:
- Thermostat Settings: Adjust your thermostat to a more energy-efficient setting during peak hours. For example, set it a few degrees higher in summer and lower in winter.
- Pre-Cooling/Heating: Pre-cool or pre-heat your home before peak hours begin, then maintain the temperature with minimal energy use.
- Lighting:
- LED Bulbs: Replace incandescent bulbs with energy-efficient LED bulbs, which use less electricity and last longer.
- Natural Light: Make the most of natural light during the day to reduce the need for artificial lighting.
- Energy-Efficient Appliances:
- Upgrade Appliances: Invest in energy-efficient appliances that consume less electricity. Look for high energy star ratings.
- Maintenance: Regularly maintain appliances to ensure they operate efficiently. Clean filters, coils, and vents to improve performance.
- Solar Power:
- Solar Panels: If feasible, install solar panels to generate your own electricity. This can significantly reduce your reliance on grid power during peak times.
- Battery Storage: Consider adding battery storage to store excess solar energy generated during the day for use during peak hours.
- Behavioral Changes:
- Unplug Devices: Unplug devices and chargers when not in use to avoid phantom loads (standby power consumption).
- Energy Awareness: Educate household members about the importance of reducing electricity usage during peak hours.
- Monitor Usage:
- Smart Meters: Use the data from your smart meter to track your electricity usage patterns and identify peak consumption times.
- Energy Apps: Many energy providers offer apps that provide real-time data on your electricity usage. Use these tools to monitor and adjust your habits.
Understanding and managing demand tariffs can seem daunting, but with the right tools and strategies, you can take control of your electricity costs. By shifting usage to off-peak times, investing in energy-efficient appliances, and monitoring your consumption, you can minimise the impact of demand charges on your electricity bill.
About CovaU Energy
CovaU Energy is a 100% Australian-owned company providing electricity and gas to homes and businesses across Australia. We offer competitive energy plans, top-rated 24/7 customer service, no lock-in contracts. We also have incredible rewards to our new and existing clients. For more information about our electricity and gas plans, call 1300 111 688 to talk to our energy specialists or request a quote for the rates in your area. You may also compare plans and directly sign up here.
Sources: Canstar Blue | Ausgrid
