Cheap Fixed Price Electricity Contract in Perth

Ideally when you sign a contract you expect that your contract price will remain fixed for the duration of the contract.

For example for a mobile phone contract, you pay a set price and it will remain the same for the duration of the contract.

The Energy industry is a highly regulated industry. There are so many components that make up your energy cost such as capacity charge, network charge, renewable charges and energy charge.

The electricity suppliers here in Perth are making money only from the energy they procure and on sell it to consumers. The rest are risks and the majority of them are beyond  their control.

You will find on almost that one almost every single contract, the energy suppliers here in Perth will have a provision where they may pass through those associated risks such as network costs increase and changes in law.

Businessman working with touchscreen

So what is network cost and how often does it  get adjusted?

Every electricity company in Perth uses Western Power’s network  to transport the energy from the the supplier site (power station) to the end user site. All the network infrastructure such as poles, transformers, substations are owned and maintained by them. From time to time, Western Power as the network operator  may adjust the transportation cost in order to ensure the network is reliable and capable to deliver the energy.

Western Power will submit their proposal to an independent government body (Economic Regulation Authority –ERA) who basically will have a say on the amount it increases as well as the frequency of the increase. Historically speaking the network cost increase occurs almost every financial year.

 

The government regulations play a major part in the energy  industry. The Energy industry is a business where  involved in polluting the environment directly and indirectly.  Therefore, the government has a significant influence on where they will be taking the industry. Any changes in government regulation will affect the electricity price that you pay to your electricity supplier. For instance in 2012 the federal government introduced a carbon cost scheme that caused energy costs to increase up to 10%. Although the carbon scheme has been repealed, any future legislation changes that will impact the industry will be passed through to the consumer, whether you like it or not.

A fixed electricity contract is difficult to secure but if you are willing to pay premium price to reflect the risks some electricity companies in Perth  will consider selling a fixed contract to you.

 

By | 2017-05-04T14:43:30+00:00 September 10th, 2015|Blog Post|0 Comments