A cheaper plan, solar panels, a battery or moving away from gas? Follow the money in four simple examples, then try the decision with your own home.
01 / Electricity plans
Which electricity plan is cheaper?
A lower off-peak price helps only when you use electricity at that time. The same yearly usage can favour a different plan.
Our assumed prices
4,000 kWh of electricity over 365 days. Plan A charges 30c/kWh at all times. Plan B charges 45c in peak periods and 20c off-peak. Both charge $1 a day to stay connected. No solar, discounts, separate hot-water tariff or demand charge.
Same usage, different timing
When electricity is used
Plan A: one rate
Plan B: peak + off-peak
Cheaper choice
25% peak, 75% off-peak
$1,565/year
$1,415/year
Plan B by $150/year
60% peak, 40% off-peak
$1,565/year
$1,765/year
Plan A by $200/year
Check the first row: Plan A is 4,000 × $0.30 + $365 = $1,565. Plan B is 1,000 × $0.45 + 3,000 × $0.20 + $365 = $1,415.
Your next decision
Use a full year of smart-meter readings when available. Otherwise start with a bill and treat the assumed timing as an estimate. An optional plan ID from your bill can match a published offer; confirm its rates against your latest bill.
Solar can save money in two ways: using it at home avoids buying electricity, while sending the surplus to the grid earns a feed-in payment.
Our assumed prices
Panels generate 5,000 kWh in a year. Buying electricity costs 30c/kWh; exports earn 5c/kWh. The daily connection charge stays the same. There is no battery in this example.
Same generation, different use at home
Solar energy
Less daytime use
More daytime use
Used directly at home
2,000 kWh
3,500 kWh
Sent to the grid
3,000 kWh
1,500 kWh
Avoided purchases + export payments
$600 + $150
$1,050 + $75
Yearly bill reduction
$750
$1,125
$375 more value from the same solar generation
The second pattern shifts 1,500 kWh of existing demand into sunny hours. Each shifted kWh saves 30c but gives up a 5c export payment: 1,500 × 25c = $375. It assumes that much demand can actually move into those hours; adding unnecessary use would not create the same saving.
A postcode gives a useful local climate starting point. Roof direction, shade, panel layout and export limits still need an installer's assessment. Annual sunshine alone does not tell us when the home can use the generation.
Compare a battery with keeping solar alone. The battery's extra value is the electricity it helps you avoid buying, after accounting for lost export payments and energy lost in storage.
Our assumed day
8 kWh of spare solar can charge the battery. It returns 7.2 kWh later, when the home needs that much electricity. Buying power costs 30c/kWh; exports earn 5c/kWh. This happens on 250 days a year. On the other days we assume no extra battery saving.
$2.16 avoided purchases per useful day7.2 kWh delivered × 30c.
Minus 40c in export payments8 kWh used to charge × 5c that solar alone would have earned.
$1.76 extra daily value, or $440 a year($2.16 − $0.40) × 250 useful days.
A $6,600 extra installed cost would take 15 years to recover in this example
$6,600 ÷ $440 = 15 years of unchanged savings. Use the additional battery cost after confirmed discounts, rather than counting the solar panels again. A different tariff, more useful days or a lower quote would change the result.
This simple payback excludes finance, maintenance, degradation, replacement, price changes and VPP payments. It does not value backup during outages. Backup needs specific equipment and wiring, and keeping energy in reserve can reduce everyday bill savings.
Count the extra electricity as well as the gas you stop buying. Replacing the last gas appliance can also remove the daily gas connection charge.
Our assumed year
The gas appliances use $1,200 of gas, plus a $300 connection charge. Efficient electric replacements providing the same heating, hot water and cooking add $900 to the electricity bill. These are teaching figures, not an appliance performance forecast.
Ongoing energy costs before and after replacing all gas appliances
Yearly cost
Before
After
Gas used by appliances
$1,200
$0
Gas connection
$300
$0 after disconnection
Extra electricity for replacements
$0
$900
Costs being compared
$1,500/year
$900/year
$600 a year saved in this example
$1,200 gas + $300 connection − $900 extra electricity = $600. If the gas connection stays active, the $300 charge remains and this assumed saving falls to $300. Your other electricity use is unchanged and excluded from both columns.
Ask about installation, circuits, switchboard work and gas disconnection or abolishment fees before deciding. Change appliances in a practical order; the supply-charge saving comes only when the connection is ended. Actual use depends on the building, weather, equipment and habits.
These sources explain bill comparisons, solar, storage and electrification. The assumed figures above are our educational examples, not figures quoted from these sources.
