This article will explain what energy data is, its significance and how analysing the data can assist in reducing energy costs for your business. We’ll also discuss the impact of charges associated with energy contracts, networks and levies and how we can help you plan for future energy needs. By the end, you’ll have a better understanding of energy data and its impact on managing your business’s energy more effectively and efficiently.
What is energy data and why is it important?
Energy data is the information on your meter and is a read on how much energy you have used during a particular billing period. This is collected by your retailer and is then processed using a particular formula to then issue you with a bill. This meter reading is commonly known as the ‘source of truth’, with very few people being able to access their own data. With this data taken directly from the meter, discrepancies can be found which can be a contributing factor in an underlying issue when faced with a hike in your electricity bill.
Related articles
What are you missing from the data?
Understanding sudden hikes in electricity bills can be difficult, even in the case of solar electricity. One of our clients who had recently installed solar came to us because they weren’t saving as much as they had expected. Luckily, they did, as our energy experts sourced and reviewed the data and discovered that the solar panels were not connected properly.
Another part of the energy data equation is making sure to get the right tariff for your business. For example, a sports club that needs field lighting during weekday evenings will require a different tariff compared to a smash repair shop that is only open during business hours. It’s all about getting the most optimal tariff for your business, which we can help you with.
To better understand the energy ecosystem and what it is made up let’s look at where various data comes from in relation to energy contracts, networks and levies.
What is an energy contract?
When you purchase and use electricity and gas from an energy provider (or retailer) you automatically enter into a contract. If you move into a property with an existing energy connection, you are responsible for paying the energy bill to the current provider according to the contract. However, you can choose to break the contract and switch to another provider if there are multiple retailer options and competition is allowed in your state or area.
In Australia, there are two main types of energy contracts: standard retail contracts and market contracts. These are:
Standard retail contracts – if you have never switched retailers or contacted a retailer to change your energy contract, you are most likely on a standard retail contract with set terms and conditions. Some of these contracts have prices for energy that are determined by the state or territory government and cannot be changed by the retailer.
Market contracts – generally have a set of minimum terms and conditions that are the same across all contracts, however, some may vary. It’s possible that you won’t be eligible for every market retail contract that energy retailers offer, but you can compare different contracts to see what options are available. Market contracts may offer cost savings, renewable energy options, or discounts. They can also have fixed-term durations that come with exit fees if you decide to leave early. Keeping in mind that market contracts can differ between retailers. It’s a good idea when selecting a market contract to browse various options to find the one that best meets your needs.
What do these charges and levies mean on my bill?
Network Service Charges – make up a large percentage of electricity bills, so it’s good to understand what’s included. These charges are a combination of the cost of transporting electricity from generation point to point of consumption and the transmission and distribution infrastructure (poles and wires). It also includes a charge for the operation, maintenance and upgrade of the electricity grid.
Every year on July 1st, network charges are reviewed for all states in the National Electricity Market (NEM), including Victoria. In the past, Victoria reset charges on January 1st each year. As changes in network rates and charges can significantly affect electricity bills, it’s crucial to have experts who can help you plan for and manage these costs for your business.
Metering Charges – retailers pass on costs associated with the installation and maintenance of meters, as well as billing. For most clients, metering services are procured by the retailer from a Local Network Service Provider. For residential and small businesses this is made up of two parts:
- Capital component – which covers the cost of the meter
- Non-capital component – which covers the ongoing costs of operating and maintaining the meter
Larger energy users can engage with an independent, registered Meter Service Provider to read their meters and provide the metering data to retailers for billing.
Environmental Levies – to address climate change and achieve renewable energy goals, various federal and state mandates have been established. Under these mandates, retailers are required to turn in compliance certificates in proportion to their energy sales. These certificates are generated as a result of the desired activity promoted by the mandate. Retailers can obtain these certificates either directly from the issuer or in a secondary market. Failure to turn in adequate certificates can result in penalties for retailers. Retails then pass this cost of compliance to the end user – charges that need to be taken into consideration when comparing and negotiating with different retailers.
Retailers pass the cost of complying with these schemes to end users. It is important to take account of these charges when comparing different offers from retailers and negotiating with them.
By doing a full bill analysis and extracting the data, we can see any errors in your bill, and usage patterns and assess these against any tariff charges. This enables us to work out how to make your energy consumption more strategically cost-effective. Understanding energy data provides a solid foundation for managing your business’s energy consumption. If you need more information or would like to discuss your energy queries, get in contact with Sharon today at either 0428 918 180 or via email at sharon@wiseupenergy.com.