Small business electricity: compare plans, tariffs and providers (Australia)

Electricity is one of the biggest controllable overheads for Australian SMEs. The challenge is that a “cheap rate” on an ad is rarely the rate you actually pay once network charges, tariff type, metering and your trading hours are factored in.

This guide explains how small business electricity works in Australia, what drives your bill, how to compare offers properly, and practical ways to reduce costs without disrupting operations. If you want a fast answer based on your real usage, Zembl can complete a free bill review and compare offers from our retailer panel.

What is classed as small business electricity in Australia?

“Small business” is not one universal category across every retailer and network, but in practice most small business electricity accounts have:

Lower annual consumption and simpler billing than large commercial and industrial (C&I) accounts
Standard retail contracts rather than wholesale market exposure
Tariffs that are typically flat rate or time of use, sometimes with demand charges depending on meter and network

If you manage multiple sites, run refrigeration, or have equipment that turns on together (for example, HVAC plus kitchen loads), it is still possible to be on a tariff structure where demand matters. This is why reviewing the tariff as well as the retailer price is important.

What small business electricity costs are made up of

Your bill is usually a combination of fixed charges and variable charges. Knowing which parts you can influence helps you target savings.

Usage charges (c/kWh)

This is the cost for the electricity you consume. Depending on your tariff, usage may be charged as:

Single rate: one rate for all consumption
Time of use: different rates for peak, shoulder and off-peak periods
Controlled load: separate rate for specific circuits or equipment in some cases

Daily supply charge (c/day)

This is the fixed daily cost to stay connected. For small businesses with modest consumption, supply charges can make up a surprisingly large share of the bill, especially across multiple sites.

Demand charges (where applicable)

Some businesses, particularly those with smart meters and certain network tariff assignments, may pay a demand charge based on the highest 15 or 30 minute interval during the billing period. Demand is measured in kW or kVA. If you have short, sharp peaks, demand can drive a large portion of total cost even if annual kWh is not high.

Network, metering and environmental components

Retailers bundle a range of other costs into your price, including regulated network tariffs, metering fees and environmental scheme costs. These vary by state and distribution zone, so two businesses with similar usage can pay different effective rates if they are on different networks.

Typical small business electricity usage in Australia

Small businesses often use somewhere around 13,000 to 36,000 kWh per year, depending on location, operating hours, equipment and tariff structure. A café with refrigeration and kitchen load will look very different to a professional services office, and that difference should influence the tariff and contract you choose.

Tariff types small businesses commonly see

Understanding your tariff is one of the fastest ways to find savings, particularly if your usage pattern has changed over time.

Single rate (flat) tariffs

One rate applies all day. These can suit businesses with fairly even usage or where operations are mostly during standard daytime hours and the flat rate is competitive.

Time of use tariffs

Rates vary by time. Peak periods are often weekday late afternoon and early evening, but the exact time bands depend on your state, network and retailer. Time of use can be cost effective if you can shift discretionary load, for example dishwashers, pre-cooling, batch processing or EV charging, into off-peak periods.

Demand tariffs

Demand tariffs add an extra charge based on your highest interval of electricity demand. These can suit businesses with steady load and controlled peaks, but they can be expensive for sites where multiple large loads start together. If demand applies to your bill, simple operational changes can reduce costs, such as staggering start times for HVAC, compressors or machinery.

How to calculate your small business electricity bill

A simplified view of most bills looks like this:

Energy cost = kWh used × usage rate(s)
Supply cost = number of days × daily supply charge
Plus any demand, metering or additional fees that apply

If you want to estimate the effective price you are paying, you can calculate an average:

Average c/kWh = (total bill excluding GST) ÷ total kWh for that period

This average is helpful for a quick sense check, but it can hide issues like demand charges or high supply charges. A proper comparison should model the bill under alternative tariff structures.

How to compare small business electricity plans properly

Comparing plans is not just comparing one cents per kWh number. Use this checklist.

1) Confirm your meter type and tariff on the bill

Look for tariff names such as single rate, time of use or demand. If you have interval data available, it becomes easier to match a tariff to your trading hours.

2) Compare supply charges and usage charges together

A lower usage rate can be offset by a higher supply charge. This matters most for low usage sites and multi-site portfolios.

3) Check time bands if you are on time of use

Peak, shoulder and off-peak periods differ by state and network. A plan that looks cheaper may have peak times that overlap your busiest hours.

4) Identify demand exposure

If demand charges apply, confirm:

How demand is measured (kW or kVA)
The interval length (15 or 30 minutes)
When demand is measured (all day or specific peak windows)

5) Review contract terms and fees

Contract length and what happens at the end of term
Any early exit fees
Billing frequency and payment options
Whether price changes can occur during the term

6) Consider service and account management

For many small businesses, fast support and accurate billing matters as much as price, particularly when you are time poor.

How to reduce your small business electricity bill

There are two levers: reduce consumption and reduce the rate you pay. Ideally you do both.

Upgrade lighting to LEDs

Lighting is often one of the easiest upgrades. LEDs typically use significantly less electricity than older halogen or fluorescent lighting and reduce maintenance due to longer lifespan.

Choose energy efficient equipment

Where relevant, check energy ratings and standby consumption. For hospitality and retail, refrigeration performance and maintenance can materially change usage.

Reduce standby power

Standby power can add up across POS systems, routers, screens and small appliances. Smart power boards and shut-down procedures can help.

Optimise heating and cooling

HVAC is frequently a major driver. Consider set point policies, timer schedules, preventative maintenance, and pre-cooling or pre-heating strategies that shift load away from high price periods if you are on time of use.

Review tariff and retailer pricing at least annually

Usage patterns change as your business grows, trading hours shift, or new equipment is added. A tariff that suited you two years ago may no longer be the best fit today.

Why small business electricity prices vary by state and location

Electricity pricing varies across Australia due to wholesale market conditions, retailer competition and, importantly, network charges that differ by distribution area. Even within the same state, different network zones can have different tariff structures and underlying costs.

How Zembl helps with small business electricity

Zembl helps businesses compare small business electricity plans and navigate tariff complexity without spending hours calling retailers.

Free bill review: we assess your current rates, tariff structure and key cost drivers
Comparison and recommendation: we compare options from our retailer panel based on your actual usage
Switching support: we handle paperwork and coordinate the changeover
Support for growing businesses: as you add sites or usage changes, we can re-check your fit

Next steps

If you want to know whether you are overpaying, the quickest step is to have your latest bill reviewed. Zembl can compare offers and explain the trade-offs between tariffs so you can choose a plan that suits the way your business actually uses electricity.

Related Zembl resources:

General information only, not financial or legal advice. Availability of retailers and plans varies by state, network and metering type.