How electricity pricing works in Australia
Electricity prices in Australia are set by a combination of factors: the wholesale cost of generation, network charges from your local distribution company, retailer margins, and government environmental schemes. The single biggest factor is which distribution network your address sits on, because network charges typically make up 40 to 50 percent of your bill.
The Australian Energy Regulator (AER) sets a Default Market Offer (DMO) for NSW, South East Queensland, and South Australia. In Victoria, the Essential Services Commission sets a Victorian Default Offer (VDO). These are the maximum prices a retailer can charge customers on a standing offer, and they serve as the reference point for advertised discounts.
Distribution networks by state
Your distribution network determines which retailers can supply your address and what network tariff structure applies. Here are the networks operating in each state.
| Network |
Area covered |
| Ausgrid |
Sydney, Central Coast, Hunter |
| Endeavour Energy |
Western Sydney, Blue Mountains, Southern Highlands, Illawarra |
| Essential Energy |
Regional and rural NSW |
| Network |
Area covered |
| Energex |
South East Queensland (Brisbane, Gold Coast, Sunshine Coast) |
| Ergon Energy |
Regional Queensland |
| Network |
Area covered |
| CitiPower |
Melbourne CBD, inner suburbs |
| Powercor |
Western Victoria, outer western Melbourne |
| Jemena |
Northern and western Melbourne |
| United Energy |
South-eastern Melbourne, Mornington Peninsula |
| AusNet Services |
Eastern Victoria, outer eastern Melbourne |
| Network |
Area covered |
| SA Power Networks |
All of South Australia |
| Network |
Area covered |
| Western Power |
South West Interconnected System |
| Horizon Power |
Regional and remote Western Australia |
| Network |
Area covered |
| TasNetworks |
All of Tasmania |
| Network |
Area covered |
| Evoenergy |
All of ACT |
| Network |
Area covered |
| Power and Water Corporation |
All of Northern Territory |
Tips for comparing electricity plans
When comparing electricity plans, look beyond the headline discount. A large percentage off a high reference price can still leave you paying more than a smaller discount off a lower base. Focus on the estimated annual cost for your usage level, and check whether the plan has any conditional discounts that require paying on time or by direct debit.
If your home has solar panels, pay close attention to the feed-in tariff offered by each retailer. The difference between a low and high feed-in rate can be worth hundreds of dollars a year depending on your system size and export volume. See our solar plans comparison for more detail.
