Should I compare a full year worth of bills?

There's no single 'best' energy plan that will deliver optimal pricing year round. If you want to stay on the best prices, you need to keep checking. Bill Hero does all the work for you to keep on top of it

Should I compare a full year worth of bills?
Photo by Blessing Ri / Unsplash

We've done the work and established that, unfortunately, there's no such thing as a single 'best' energy plan that will deliver optimal price outcomes year round.

To pay as little as possible, you need to keep comparing, and Bill Hero is designed to do this work for you.

Of course we understand that seasonal variation in energy consumption and solar production will occur, and it may seem counter-intuitive not to base the recommendation on a full year of data – this article explains why we've designed the system this way.

Bill-by-bill is best

As more people install solar, and as the average size and generation capacity of those solar systems is growing, the average seasonal variation in energy imported from the grid is becoming more and more pronounced, and so it's becoming less and less realistic to find a single 'one size fits all' plan that will deliver a competitive result year round.

The difference in price between a single 'best' year-round plan vs best plans on a per-bill basis can be very significant

Energy plans always include trade-offs between daily connection charges, consumption charges and feed-in tariff rates. For solar customers, the FiT rates that retailers offer are funded by the margin they make on energy.

This means that the most generous FiT rates are usually associated with relatively uncompetitive prices for kWh consumption.

So the best summer-time plan when consumption is lower and exports are higher is less likely to yield competitive outcomes during winter, when you'll be importing more and exporting less.

Adopting an aggregated 'full year' comparison strategy only means that you'll be finding the 'least worst' compromise plan.

The optimal strategy for minimising energy costs is not to try to find the single 'best' plan, but instead to continuously track the pricing available across the market, and to switch opportunistically whenever the potential value in dollars saved is greater than your own personal assessment of the effort required to switch.

The catch is that it takes effort to compare and switch, which is why Bill Hero does the work for you.

Bill Hero automatically runs a personalised comparison for you on every single bill, so it takes no effort at all for you to see what is available across the market, and understand what your potential savings are.

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We designed our Bothered Threshold feature to help you tailor the advice the system generates for you – it will recommend a switch only when the identified savings exceed your own value placed on the effort required.

You can change your Bothered Threshold at any time, and even when a switch is recommended, it's always your choice to proceed or not.

Our system does all the leg work for you to automatically compare every bill against the entire market.

Month by month and bill by bill, the seasonal variations will flow through, and the system will recommend a switch whenever it makes sense, based on your personal Bothered Threshold preferences.

Predicting future consumption?

Energy bills document historical consumption from the previous billing period, so there's a lag in using that data to make a switch.

We've explored how we can predict future consumption to help subscribers move to the best plan for their anticipated consumption in the next billing period.

There are two main ways to approach this: algorithmically projecting future billing period consumption, and using previous year bills for the equivalent period.

It's easy to apply season variation factors to energy consumption to algorithmically establish an estimated future consumption level. However, at the individual household level, we've found this approach is unreliable. Actual energy consumption is dependent on the unique thermal characteristics of your home, and the appliances you use. Energy consumption is very sensitive to weather events and changes in household activity, so it's hard to predict future consumption in a reliable way.

In theory, we could also request full year bills and base each analysis on the previous years' consumption for the upcoming period. We've found this to be impractical to manage at scale, since many households do not have easy access to old bills, and many retailers make it difficult to access old bills in their customer portals.

For these reasons, Bill Hero policy is to work with the factual consumption data documented in each bill, and we base our automated processes around this reliable, regular, factual data source.

TIP: You can generate your own results for a future billing period by manually sending in a bill for the upcoming period from a previous year.

Here's how you can upload your bills:

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