Energy Prices Explained

Electricity

Gas

What makes up your electricity bill?

An electricity bill is made up of various costs of delivering electricity to your home or business. In the graph below, you can see wholesale and network costs make up the majority of your bill. These percentages are based on data provided by the Victorian Essential Services Commission. These are an example only and won't reflect individual circumstances which can be impacted by things like where you live and how much power you use.

Percentage figures are rounded to the closest whole number. Source: ¹

Network 37%

Electricity has to get from where it’s produced to your place. And this network cost covers the 'poles and wires' to do this. Network costs have grown from 31% to 37% in the past year.

Wholesale 30%

This is what retailers pay for the energy they sell and factors in what it costs to generate. As a proportion of an average bill, wholesale prices have reduced from 36% to 30% in the past year.

Environmental 7%

These are charges that cover costs retailers incur to comply with government programs that promote renewable energy and energy efficiency.

Retail operating costs 12%

Basically, the cost of all the things needed to run a business; call centres, customer care, marketing, billing, wages for employees who keep everything running smoothly.

Retail margin 5%

This is the profit retailers make. Any profit Momentum makes is either reinvested back into our business or goes to our parent company, Hydro Tasmania, Australia’s largest generator of renewable energy.

GST - about 9%

Yep, this is pretty self-explanatory. The Goods and Services Tax is added to most of what you buy in Australia. Certain basics are excluded. And while you might expect this to be 10%, when you add 10% to the invoice this actually makes it 9% of the overall bill.

Where is electricity sourced from?

According to annual data for the National Electricity Market (NEM), most of Australia's electricity is produced from burning black (46%) and brown coal (16%). Renewables contribute most of the remaining energy supply, with solar (9%), wind (16%), and hydro (7%) being the key sources. Coal-fired generation continues to decline, while renewables are increasing each year.

Percentage figures are rounded to the closest whole number. Source: ²

What makes up your gas bill?

Your gas bill is made up of the various costs of delivering gas to your home or business. These costs include:

Wholesale

This is the cost to the retailer of purchasing gas from suppliers. It is influenced by market factors such as supply and demand, as well as production costs like exploration, extraction, processing and storage.

Network

Gas has to get from where it’s produced or stored to your place. This happens via big transmission pipelines, to bring it to your local area. From there it travels through distribution networks that transport it right to your home or business.

Environmental

These are charges that cover costs retailers incur to comply with government programs that promote renewable energy and energy efficiency.

Retail

Basically, the cost of all the things needed to run our business; such as call centres, customer care, marketing, billing, and wages for employees who keep everything running smoothly.

Retail margin

GST

Yep, this is pretty self-explanatory. The Goods and Services Tax is added to most of what you buy in Australia.

Where is Australia's gas sourced from?

Natural gas is the third highest energy source in Australia (after oil and coal). It is used by power stations for electricity generation, factories for manufacturing, and homes for heating and cooking. It is a non-renewable source that emits around half the emissions of coal when used to generate electricity.

Gas used to come from large remote reservoirs, such as the Moomba and Bass Strait gas fields. More recently, coal seam gas comes from Queensland with untapped reserves in NSW and Victoria.

Once gas is sourced from gas fields (oil and gas wells or coal seam wells) it is processed to specification. This includes adding the odour for safety reasons, and compressing the gas for transport. Source: ⁴

How to keep your bill from getting out of control

Check prices

Reduce your use

Check you’re on the best deal

Log into your Momentum Energy account and check if you’re on our best deal. There may be some conditions attached to any lower offer, including moving to direct debit (which help us reduce operating costs).
Compare how your current bill compares with other retailers. Victorian Energy Compare (for Victorians) and Energy Made Easy (all other states) are independent, Government-run comparison sites.

Reduce your energy use (and your bill)

Cutting down on consumption can make a big difference to your final bill. Momentum has a number of guides on how to save money, including:

What to do if you’re finding it tough

If you’re experiencing financial difficulty, there's help available.

Reach out

We’re here to help. If you just need a little more time to pay, you can request a payment extension through MyAccount by clicking “Payment options”, then “Request an Extension”.

If you think you need help beyond a payment extension, more support is available including setting-up payment plans. You can find out more on our Payment Assistance page, or call us to speak to a dedicated team member.

We can also offer advice on government and non-government assistance that might be available, such as the Utility Relief Grants Scheme in Victoria, which is designed to help in times of temporary financial crisis.

Explore other support

There are many organisations out there that may be able to help, including the Australian Securities and Investment Commission (ASIC). ASIC’s MoneySmart website has some useful information that could be of assistance. You can also call their National Debt Helpline on 1800 007 007.

Check if you’re eligible for concessions or rebates

All states provide a range of energy concessions and rebates. Click here to see what’s available.

Energy Bill Relief Fund

The Australian Government announced a $1.8 billion extension of the Energy Bill Relief Fund by six months in the 2025–26 Budget.

Australian households and eligible small businesses with electricity bills may receive up to $150 in energy bill rebates from 1 July 2025 to the end of 2025. Rebates will be automatically applied to your electricity bill in two $75 quarterly installments. To find out more, go to the government energy rebate site ³.

Spread your bills evenly

If you’d like to reduce the bill shock that comes with seasonal jumps in energy use, you might like to try our SmoothPay option.

It averages your energy use over 12 months, giving you even, predictable bills month to month, so there are no nasty surprises.

You can set up SmoothPay in MyAccount.

We’re proud to be owned by Hydro Tasmania.

They’re the biggest contributor of renewable energy in the country, and they’re looking at ways to increase their generating capacity (which means more renewable energy for Australia). By supporting us, you’re helping them grow too. Learn more about Hydro Tasmania.

Sources

^{1. Graph data taken from the Victorian Default Offer 2024-25: Final Decision paper, published by the Essential Services Commission}

^{2. Graph based on AEMO's NEM fuel mix 12 month view: https://aemo.com.au/energy-systems/electricity/national-electricity-market-nem/data-nem/data-dashboard-nem}

^{3. https://www.energy.gov.au/energy-bill-relief-fund}

^{4. https://www.dcceew.gov.au/energy/supply}

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We’re here to answer your questions about prices, explain the causes, and provide you with support.