5 Mistakes to Avoid When Looking for a Cheap Electricity Plan

Finding the perfect electricity plan for your requirements isn’t difficult when you know what to look for. Generally, people make common mistakes when trying to look for the cheapest electricity plan available.

There is a range of electricity plans, and depending on your budget and household needs, you can easily find a cheaper one. Don’t make rookie mistakes that end up costing you more in the long term, even though they may look like the cheapest electricity plans available.

Don’t Overestimate Your Electricity Requirements

Many people tend to think they use more or less electricity than they really do. You don’t want to end up getting a plan that’s too much or too little for your monthly or daily requirements.

To get a better idea of your current electricity consumption, you can go through your past electricity bills and plans. You can use it to estimate your weekly or monthly electricity consumption needs roughly.

If you’re planning to invest in new electric appliances like a heater, electric stove, etc., keep that in mind when looking for a new electricity plan.

Cheaper Isn’t Always Better

While you may be tempted to get the cheapest electricity plan in your area, it might not necessarily be the best one for you. Find out how much you’re paying for your current electricity plan and look for a cheaper option accordingly.

Many energy retailers use a tactic known as price anchoring to lure consumers into thinking they’re saving money when they’re not. Price anchoring refers to the process where retailers promote plans through discount percentages instead of focusing on how much a consumer will save in monetary terms.

Consumers become fooled into believing that saving 18% on a $98 plan is better than paying for a $60 plan with no discounts. Using these tactics eventually helps the retailer profit more while you’re unaware of paying more than you should be.

Choose the Ideal Contract Details

Many energy retailers who offer cheap electricity plans have additional conditions attached, like committing to a contract or paying extra costs if the daily usage limit is exhausted.

When looking for an affordable electricity plan, be careful to read through any important clauses like peak and off-peak charges, cancellation charges, etc. It will help you make an informed decision.

Choose a contract that offers you precisely what you need, and don’t pay an unrealistic amount for it. Since you have many options available, you can make the switch anytime when you feel like your plan isn’t benefiting you. Compare various options on the key parameters like prices, tariffs, cancellation charges, etc.

Don’t Skip on Comparing Plans

You can only find the cheapest electricity plans when you’re fully informed about all other options available in your area. Many areas have an abundance of energy retailers where the electricity plans are competitively priced so the consumers can save more.

When you’re confused by different terminology mentioned in electricity bills or can’t figure out if discounts can bring actual savings, using a comparison service makes more sense.

Websites that let you compare between different plans and providers in your area will have different filters or parameters to facilitate better insights. Many sites also allow you to tweak specific indicators to better set the platform according to your needs and find a perfect match.

Paying to use such services can be a worthwhile investment as it could potentially help you save hundreds of dollars every year, perhaps even more.

Research Thoroughly

You must do your research and homework thoroughly before committing to an electricity retailer, especially if you’re planning on signing a contract with them for 3, 6, 9, 12, or 24-months. Since breaking a contract is harder and may involve a hefty cancellation fee, think carefully before committing to a long-term contract.

Many regions in Australia have witnessed up to a 46% decrease in wholesale electricity costs over the past year due to new policies introduced by the government. Make sure that your current electricity retailer is passing on the benefits of these price reductions to you. If not, consider changing your provider.

Find the Best Electricity Plan for Your Needs

Instead of looking for the cheapest electricity plan in your area, you should be more focused on finding a plan that caters to all of your requirements. Once you find plans that are ideal for you, compare them to see which one offers the most savings for you.

Finding the ideal electricity plan for your household doesn’t have to be hard when you’ve got an idea of what mistakes to avoid and what aspects to consider. When you avoid making such mistakes, finding an excellent plan will require no effort or time at all.