Our complimentary network tariff review could save your business money
With a Network Tariff Review fast approaching in March, we explain exactly what it means and explore how it can assist larger businesses in managing the cost of energy.
What to look out for and why?
Twice a year, our Operations Team conduct a review of our large customers’ network tariffs to identify potential savings for their business. This is a complimentary service that we offer our customers and one that has proven highly effective in helping our larger customers stay on top of their energy costs.
What are Network Tariffs and why are they so important?
Network Tariffs are regulated pricing structures set by the network distributor to cover the cost of building, maintaining and operating the poles and wires to deliver electricity to customers.
These tariffs are typically “passed-through” to large customers, meaning the distributor’s costs are billed to you via your retailer. Unfortunately, the default network tariffs set by the distributor don’t always take into account more complex factors and alternative opportunities, rendering it less than ideal from the outset.
Network tariffs—like business operations and energy use—also change over time, meaning the right tariff three years ago might not be the most cost-effective now, and not all distributors are proactive in reassigning tariffs to optimise and align to the customers’ circumstances.
Complimentary Network Tariff Review
Photo: ERM Power staff looking at network tariff review reports (Source: ERM Power)
In our last NTO review conducted in November 2019, we identified over $1 million of potential savings for our customers. However, with the regularity of our reviews and more and more of our customers saying ‘yes’ to the tariff changes, there are potentially more savings available.
How to find out if your business’s sites may save by changing network tariffs
Our Operations Team will conduct their analysis of our large customers’ tariffs in March and our account managers will send an email, together with a report advising customers if they’ve found potential savings or not.
What if you’ve already changed tariffs?
Even if you’ve previously had your tariff reassigned, routine changes to the tariffs themselves mean there is never any harm in reassessing. Network tariffs are regulated by the Australian Energy Regulator (AER) and are typically refreshed by individual network operators every year, but even in instances where the tariff itself hasn’t changed, your business’s pattern of energy use may have.
How to change tariffs
Our team of experts will have already done the hard work for you to identify the likely optimal tariff for your site, based on historical consumption patterns. Your account manager will email you a detailed report of the NTO review (including identified potential cost savings) and will suggest options for you to consider based on this analysis.
Should a potential tariff change benefit be identified and you wish to take up the option of changing, you simply need to tell your account manager who will then get the ball rolling with the distributor on your behalf.
If you are a customer and have questions, please contact your dedicated account manager, otherwise get in touch with us.