Understanding gas and electricity charges
Gas and electricity tariffs have 2 parts:
- the daily supply charge
- the usage charge.
Daily supply charge
The daily supply charge is also known as the:
- service charge (or service to property charge)
- fixed charge.
This is the cost of getting electricity or gas to your home or small business, even if you don't use any.
You might see it on your bill:
- in cents per day
- as the total amount for the billing period.
The usage charge is also known as the:
- consumption charge
- variable charge.
This is the cost of the electricity or gas that you use.
You might see it on your bill in:
- cents per kilowatt hour (c/kWh) for electricity
- cents per megajoule (c/MJ) for gas.
Some bills might show more than one usage charge.
For example, a time-of-use plan might have different usage charges for different time periods, which are usually called:
Your retailer can calculate the usage charges on your bill in different ways, depending on your plan.
How tariff blocks look on a bill
Some energy plans split your energy usage into different tariff blocks. With tariff blocks, you pay:
- one rate or cost for the first part of your usage, then
- a different rate or cost for the next part (or parts) of your usage.
Blocks can apply to:
- quarterly usage.
For time-of-use electricity plans, blocks can also apply to the different rates that make up a tariff.
For example, you get charged one rate for the first part of your peak usage, then a different rate for the next part.
Last updated on Thursday, October 26, 2023 at 9:17 AM