A secondary dwelling (a granny flat, studio or garden unit) can be connected to electricity in one of three broad ways, and which one you have decides everything about billing. It can have its own separate meter and its own account with a retailer; it can be sub-metered off the main house so the owner reads a private meter and bills the occupant; or it can simply run off the main house's power with no separate measurement at all, folded into one household bill.
Each option has trade-offs in cost, flexibility and legality. A separate meter is the cleanest but costs the most to install; a shared account is the cheapest to set up but the hardest to split fairly and can create tax and tenancy complications if you rent the flat out. Knowing which you have (or want) is the first step.
Separate meter vs sub-metering
Separate (parent) meter
The granny flat has its own meter and NMI and its own retailer account. The occupant is a normal customer who can compare and switch. Costs the most to install but gives full independence and clean billing.
Sub-metering (check meter)
A private meter downstream of the main house meter measures the flat's usage. The owner reads it and bills the occupant. Cheaper to install, but the owner cannot legally charge more per kWh than they are charged, and rules on on-charging vary by state.
Shared / no sub-meter
The flat runs off the house with no measurement. Usage is estimated or bundled into rent. Simplest to set up, but impossible to bill precisely and often a source of disputes.
Billing a granny flat fairly and legally
If you sub-meter and on-charge an occupant, the golden rule almost everywhere in Australia is that you cannot profit from selling them electricity: you can recover the cost at the same rate you pay, but not mark it up. Charging more can stray into acting as an unlicensed energy seller, which is regulated. The specifics differ by state and depend on whether the occupant is a family member or an arm's-length tenant, so check your state's tenancy and energy rules before you set a rate.
For a rented granny flat, a separate meter is usually the cleanest arrangement: the tenant holds their own account, pays the retailer directly, and can choose their own plan, which also removes any awkwardness about the owner marking up power. If a separate connection is not practical, a transparent sub-meter reading shared with the occupant each period is the fairest fallback. Bundling power into rent is easiest but tends to over- or under-charge and offers the occupant no way to save by using less.
Whichever way it is metered, if the granny flat occupant has their own account they have the same right as anyone to compare and switch retailer. A whole-of-market comparison on their real usage (EnergySorted does this for a flat annual fee with no retailer commissions) will usually beat the default plan a new connection is set up on.
Which setup should you choose?
Renting the flat to a tenant? Favour a separate meter so they hold their own account and choose their own plan, cleanest legally and for billing.
Housing family informally? Sub-metering lets you split cost fairly at your own rate without the expense of a new connection.
Very light or occasional use? A shared arrangement bundled into a fair contribution may be simplest, but agree it in writing.
Before installing anything, get a quote for a separate meter and check your council and network requirements. A secondary dwelling sometimes needs an upgraded supply.
If sub-metering, confirm your state's rules on on-charging so you recover cost without unlawfully marking it up.
Frequently asked questions
Does a granny flat need its own electricity meter?
Not necessarily. It can have a separate meter and account, be sub-metered off the main house, or simply share the house supply. A separate meter is cleanest (especially for a rented flat) but costs the most to install. The right choice depends on whether you rent it out and how you want to bill.
Can I charge my granny flat tenant more for electricity than I pay?
No. Across Australia you generally cannot profit from on-selling electricity to an occupant: you can recover your cost at the same rate you are charged, but marking it up can make you an unlicensed energy seller. Check your state's tenancy and energy rules for the detail.
What's the fairest way to bill a granny flat?
A separate meter, where the occupant holds their own account and pays the retailer directly, is fairest and removes any mark-up concerns. If that is not practical, a transparent sub-meter reading shared each period is the next best. Bundling power into rent is simplest but rarely accurate.
Can a granny flat occupant choose their own retailer?
If the flat has its own meter and the account is in their name, yes. They can compare and switch like any customer. If it is sub-metered off the main house, they buy through the owner and cannot choose a retailer directly.
Is it worth installing a separate meter for a granny flat?
For a flat you rent to a tenant, usually yes: it gives clean billing, lets the tenant choose their own plan, and avoids any mark-up rules. For informal family use, sub-metering is often enough and much cheaper. Get a quote and check network requirements before deciding.
Can a granny flat occupant claim energy rebates or concessions?
If they hold their own account and meet the eligibility (such as a concession card), generally yes, the same as any customer. If power is bundled into rent or sub-metered through the owner, it gets murkier. Our rebates and concessions guide explains who can claim what.
A new granny flat connection started on an expensive plan. What do I do?
That is normal: new connections default to a standing or basic market offer that is rarely the cheapest. Once the account is active, run an independent whole-of-market comparison on the real usage and switch to a better plan, which is free and usually quick.
What plan suits a small granny flat with low usage?
Low usage makes the fixed daily supply charge a big share of the bill, so a plan with a low supply charge often beats one with a slightly cheaper usage rate, the same logic as choosing a plan in an apartment. Compare on the flat's real usage rather than a headline rate.
How do I read a sub-meter fairly each billing period?
Take a photo of the reading at the start and end of each period, share it with the occupant, and charge the difference in kWh at exactly the rate you pay. Our guide on how to read your electricity meter shows how to read the common meter types accurately.
Is a sub-metered granny flat basically an embedded network?
It is the same idea on a tiny scale: one connection feeding a private sub-meter, with the owner on-charging the occupant. The same core rule applies, you cannot mark the power up. Our embedded networks guide explains the principle and the price-cap protections behind it.
Can I put solar on a granny flat?
If the flat has its own roof and meter, it can potentially have its own system, though for a small dwelling the payback depends on how much of the generation you use on site. Our guide on whether solar panels are worth it in Australia covers the maths for a small footprint.
General information only, current at the time of writing. Not financial advice. Rebate schemes and rules
change; always confirm details with your retailer or state government energy site.
We use cookies to understand how the site is used and improve it. Analytics stays
off until you accept. See our Cookie Policy and
Privacy Policy.
