The days of energy companies sending people to your home to check your electricity meter will soon come to an end. Energy regulators want all Australian households to have a smart meter by 2030. The idea is that it will give a more accurate idea of your energy usage, but questions are being asked if it will save people money.
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00:00Manual meters only measure the total amount of electricity a property has used, and they
00:07need to be physically checked by someone every couple of months.
00:10This is called a flat rate tariff, meaning you pay the same rate for electricity no matter
00:16when you draw it from the grid.
00:18That is until smart meters.
00:20Smart meters send a signal back to the utility automatically every 30 minutes.
00:24By the end of this decade, every Australian home is set to be fitted with a smart meter.
00:30You already know about flat rate pricing, but what happens when pricing becomes more
00:34dynamic?
00:36So this household has still used 1,200 kilowatt hours, but let's split it up into peak and
00:41off-peak.
00:42Let's say the people who live here managed to rack up 400 kilowatt hours during the peak
00:47usage time at a cost of 60 cents per kilowatt hour, and 800 kilowatt hours during off-peak
00:53times at a cost of 20 cents per kilowatt hour.
00:58Their bill is now $100 more expensive than it was under the flat rate.
01:02It's called a time-of-use tariff.
01:06The theory goes if the price of electricity varies from hour to hour, just like Ubers
01:11and airline tickets, it creates incentives for people to turn down their air conditioners
01:16or delay setting off dishwashers during peak times, usually between 4 and 8pm.
01:23If this household did just that, reducing their on-peak usage by 300 kilowatt hours,
01:29instead of spending an extra $100, they've now saved 20.
01:34There's another type of charge that's raised the hackles of consumers even more.
01:38The ACCC is particularly worried about demand tariffs, a type of flexible price that charges
01:44for electricity based on your single biggest point of usage across an entire month.
01:49Let's say a householder is away for the first 30 days of January, but then returns on the
01:54final day of the month.
01:55It's during a heatwave, and they run the air conditioning while someone is watching TV
02:00in the living room and dinner is being cooked in the electric oven.
02:04Their maximum demand is 8 kilowatt hours that evening.
02:07Based on the way the tariff is calculated, they get slugged $60 in demand charges for
02:12the month.
02:13The ACCC says the best thing you can do is check your plan regularly.
02:19For more UN videos visit www.un.org