Navigating electricity tariffs and understanding the impact of changing tariffs is not a simple task. Farmers in the study operated a median of 5 electricity meters across their operations. Over half, 18 of the 35 farmers we interviewed, were subscribed to 3 or more electricity tariffs, often across multiple tariff suites (e.g. residential, small business, large business). Unlike other industry sectors, on-farm energy consumption can fluctuate significantly from year to year depending on rainfall and seasons, meaning it can be difficult to forecast future consumption and difficult to measure the impact of energy-efficient behaviour changes, given it may take four years to be able to compare similar seasons.
Despite this, farmers reported a lack of time to meaningfully invest in the complexities of choosing tariffs, meaning that many did not review their choices often. While 16 of the 35 farmers had changed tariffs in the previous 12 months (most of these involving their retailer moving them off obsolete tariffs), another 16 had not changed tariffs in over four years or didn’t know or couldn’t remember the last time they changed tariffs.
Here we share some specific scenarios and advice from Ergon and QFF. For more information, see the RESOURCES section below.
SCENARIOS
Tariffs can be complicated and I’ve got no time to understand them
Neil knows he should look into reducing electricity costs, because it costs him over $100,000 per year, but he doesn’t have time. He also describes not having the info to tailor his tariffs to his bank balance better. A different farmer felt even if he did change, it would be difficult being able to estimate the effect of the switch, because no two seasons are alike, so it can take years for an accurate comparison. Another farmer had eight NMI’s and had trouble uploading all these into Ergon’s Dashboard to start making some comparisons. Farmers managing multiple NMI’s, some of which are large customers, some of which are SME customers, have almost twice the number of tariffs to consider. On top of this, some farmers have many loads (e.g. irrigation pumps) connected to one NMI but have no way to see which pump might be causing problems.
How can energy be made easier for time-poor farmers to navigate?
- Learn what to do when you are near the large customer threshold and how to use your bills to estimate it HERE
- Learn how peak demand works in this VIDEO, and see how to handle it when sharing loads between NMIs HERE
Too many electricity meters to keep track of
Ben runs a large horticulture operation growing vegetables for supermarkets. He estimates his total operation involves over 30 NMI’s. Some of these NMI’s are on land he owns, but some are on leased land. For short-term leases, the electricity bill goes to the landowner, for longer-term leases, Ben transfers the bills into his name. With this many NMI’s to keep track of, most of Ben’s are connected to Tariff 20, even though he admits this probably isn’t the best value for money, he simply doesn’t have time to do a lot of research.
What should Ben do?
- See Ergon’s insights into timings and comparison between Time of Use (ToU) and controlled load tariffs HERE
- Learn how peak demand works in this VIDEO, and see how to handle it when sharing loads between NMIs HERE
Changing from Ergon
Many farmers have mentioned that they cannot come back to Ergon as a retailer if they leave for a different retailer. Sometimes farmers have mentioned that this is not possible only if they’re a large customer.
What is available for farmers that leave Ergon?
Getting the right tariff from the beginning
Tim expanded his farming operations about 12 months ago after moving to a new crop as water allocations became more generous (even though they’re still drought declared). As part of the changes, he installed 2 new high-capacity pumping stations and was told he needed an NMI for each. When the application was made for the new NMIs, Tim needed to give Ergon an estimate of what the energy use of the pumps would be, and he overestimated a little to try and make sure he didn’t have any trouble later on. Both pumps were started on tariff 44 as a large customer. The slightly larger pump has stayed on tariff 44 the whole time, but for the slightly smaller pump, he was told over the phone that it wasn’t using enough power for 44, and should be on 46. Six months later he got another call and it was moved to tariff 20. The changes and instability have made it near impossible for Tim to calculate his energy costs, and now he’s just waiting for the bills to see what the impact is.
How can farmers make sure their new investments are going to be on the right tariff from the start?