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Electricity tariffs explained

Queensland's independent economic regulator, the Queensland Competition Authority (QCA), reviews the regulated tariffs (or prices) each year and determines new prices based on a number of factors. These regulated tariffs or prices are sometimes referred to as notified prices.

Explanation of what a tariff is and how it works

The price you pay for electricity is made up of five costs:

  • generation costs: creating electricity at a power station
  • transmission costs: build and maintaining the state's extensive network of high voltage powerline infrastructure
  • distribution costs: build and maintaining the state's network of low-voltage poles and wires that deliver electricity to homes and businesses
  • retail costs: connecting customers, billing customers and managing accounts
  • green scheme costs: costs associated with the Commonwealth Government's Renewable Energy Target.

Components of residential electricity bill charges

Each residential electricity bill is made up of a consumption charge and a service fee.

Breakdown of typical Tariff 11 bill costs in 2015-16

Breakdown of typical Tariff 11 bill costs in 2015-16. Wholesale (generation): 21%, network (poles and wires) 52%, green schemes (renewable energy target): 2%, retail (call centres, billing): 22%. Information provided by the Queensland Competition Authority. Totals do not add due to rounding.

Consumption charge:

  • Also known as usage charge, variable charge or energy use charge
  • The charge for the amount of electricity you use
  • Charged in cents per kilowatt hour (c/kWh)
  • Estimated cost of the carbon tax is no longer factored into the consumption charge

Service fee:

  • Also known as service charge, fixed charge, daily supply charge, or service to property charge
  • Charged regardless of the amount of electricity used by customers
  • Charged in cents per day or dollars per billing period
  • Covers costs that do not depend on actual energy usage, for example those associated with maintaining poles and wires, and customer administration

Demand charge:

  • A new optional type of charge for households in Queensland
  • Charged in dollars per kilowatt of maximum demand per month
  • Based on how much electricity a household is drawing from the network at a particular moment in time.
  • See tariffs table for current service charges

Note: some customers may pay a different price than the regulated price set by the QCA, if they are on a market contract rather than a standard retail contract.

Metering charges

From 1 July 2015, electricity metering costs will not be included in electricity prices set by the QCA. Retailers will be responsible for incorporating metering charges into customer bills in 2015–16.

This is not a new cost because metering charges were previously included in the daily fixed charge.

Tariff 11's metering charge is 9.67 cents per day, while Tariff 31 and Tariff 33's charge is 2.89 cents per day.

These charges pay for the costs associated with providing meter services, such as:

  • purchasing the metering equipment
  • the onsite connection of a meter
  • works to inspect, test, maintain, repair and replace meters
  • quarterly or other regular reading of the meter
  • processing, storage, delivery and management of metering data.

Electricity tariffs

Tariff 11: standard residential tariff

  • Tariff 11 is the standard residential retail electricity tariff for general domestic/residential electricity supply.
  • Most or all of a residential customer's electricity costs are charged using this tariff.
  • Customers on this tariff pay the same rate for electricity consumed, whatever the time of day.

Time of use Tariffs 12, 12A and 14

  • These tariffs have more expensive charges for electricity used during peak periods and cheaper rates for electricity used at other times.
  • Tariff 12 is available to customers in the Energex network area in South East Queensland.
  • Tariff 12 A and Tariff 14 are available to customers in the Ergon Energy network area in regional Queensland.
  • Tariff 12A has high prices that apply during peak times on weekdays in the summer months only, with cheap prices the rest of the time.
  • Tariff 14, a new type of tariff for residential customers, has expensive demand charges during peak periods in summer, but cheaper fixed and consumption charges.

Tariffs 31 and 33: economy or controlled load tariffs or limited guaranteed supply

  • Tariffs 31 and 33 are cheaper than Tariff 11 and may be used for appliances such as hot water systems and pool pumps.
  • Tariff 31 guarantees supply for 8 hours per day while Tariff 33 guarantees supply for 18 hours per day.
  • Residential customers must be on Tariff 11 or 12 before being able to access Tariffs 31 or 33.

Find out more

Last updated
23 June 2015