Understand your electricity bill

It is a fixed fee (often 90c to $1.30 a day) for being connected to the grid, and no, you cannot avoid it while you have a connection. It is charged every day even if you use no power, which is why a low-usage home should weigh the supply charge as heavily as the usage rate when comparing plans.

It is cents per kilowatt-hour, the price of the actual electricity you use. A kilowatt-hour is the unit power is sold in, the same way petrol is sold in litres, and dividing your usage charge by the kWh used gives your real cost per unit.

Almost always because your rate changed: a 12-month benefit period ended and stepped your prices up, or your retailer lifted its rates. If your kWh used is roughly the same as last year but the dollars are higher, the price moved, and that is the moment to compare it against the rest of the market on your real usage.

A demand charge is an extra fee based on your single highest 30-minute power draw in the period, measured in kW rather than kWh. It is common on some plans (especially in parts of Victoria and Queensland) and is hard to predict. See demand charges explained to check whether your plan has one and how to keep it low.

It is a separately metered circuit, usually electric hot water or slab heating, that the network switches on mostly overnight in exchange for a much cheaper rate. If you have electric hot water, being on a controlled load tariff can save a lot compared with heating water at the normal usage rate.

If you have solar, the feed-in tariff (FiT) is what your retailer pays you per kWh for power you export, and it appears as a credit that reduces your total. Compare the feed-in rate as carefully as the usage rate, because a high FiT can outweigh a slightly higher usage price. See solar feed-in tariffs explained.

A guaranteed discount always applies. A conditional one (usually pay-on-time) only applies if you meet the condition, and you lose it the moment you pay a day late. If you ever pay late, the guaranteed price matters far more than a big conditional headline number.

In NSW, SA and south-east Queensland, retailers must show how their offer compares to a government-set benchmark price. It is a rough sanity check, not a guarantee you are on the cheapest plan, so a "10% below reference price" claim can still lose to a better market offer.

If the meter was not read in time, your retailer estimates usage from your history and trues it up on the next actual read. On a smart meter this is rare; on an older basic meter an estimate can make one bill look unusually high or low, so check whether the read is marked "estimated" or "actual".

Look for a line labelled "usage", "consumption" or "kWh" for the billing period, sometimes split into peak, shoulder and off-peak. Dividing your usage charge by that number gives your real cost per kWh, which is the only fair basis for comparing plans.

Work through the loads that actually move the number (heating, cooling, hot water, pool pump, a second fridge) then re-check your plan. Our 12 practical ways to cut your power bill covers the free habit changes first, before any switch.