At Strata Utilities it’s our job to keep up to date with all the current trends and information in the electricity market so we can find the best options for your electricity contracts.

Here is a brief overview and introduction to some aspects of Australia’s electricity market which we keep an eye on. We will provide regular updates and reports on this page as a quick reference to keep you informed with the latest news.

National Electricity Market

Australia's National Electricity Market (NEM) is one of the largest interconnected electricity systems in the world. It covers around 40,000 km of transmission lines and cables, supplying around 9 million customers.

The NEM is a wholesale market through which generators and retailers trade electricity in Australia. It interconnects the six eastern and southern states and territories and delivers around 80% of all electricity consumption in Australia.

Western Australia and the Northern Territory are not connected to the NEM. They have their own electricity systems and separate regulatory arrangements.

How does it work?

The NEM facilitates the exchange of electricity between generators and retailers. Retailers resell the electricity to businesses and households.

The wholesale market is where generators sell electricity and retailers buy it to on-sell to you. There are lots of generators and retailers participating, so it’s highly competitive.

Get the timing right

Energy prices change over time, so it’s important to research the market to get a feel for the best times to negotiate or enter into new contracts.

It’s also important to get the length of any new contract right: if energy prices today are cheaper than expected in the future, it may be better to choose a longer contract. If prices are decreasing, a shorter contract may be better, as you may be able to buy energy at a lower price down the track.

Bills and Tariffs

Your bill is made up of the amount of energy you consume, multiplied by the price per unit. The price per unit can vary according to the time of day you use your electricity and what sort of contract you’re on. It can also vary depending on where you live, as each state and territory makes its own decisions about the costs of the various components involved in energy supply.

Your electricity tariff has two parts; a daily supply charge (sometimes called a service charge or fixed charge) and a usage charge (a consumption or variable charge).

This daily supply charge is the cost of getting electricity to your place, even if you don’t use any and appears on your bill as a total amount or in cents per day.

The usage charge is the cost of the electricity you use and appears on your bills in cents per kilowatt hour (c/kWh) for electricity.

Some bills might show more than one usage charge. For example, a time of use offer might have different usage charges for different blocks of time, which are usually called peak, shoulder, and off-peak.