Households play the electricity spot market to cut power bills

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Customers are reaping rewards for riding the volatile wholesale market for electricity, but it comes with a bill shock warning.

Some people play the stock market to try to get ahead. Others have decided to play the electricity market, backing themselves to cut expensive bills by working out the cheapest time to flick a switch.

Andre Obradovic says his power bills are significantly cheaper since he linked them to the wholesale spot market through Amber.Obradovic uses the Amber app, which alerts him to fluctuations in the wholesale spot price, to run energy-hungry appliances when renewables are powering the grid and prices are low.

Traditional retail companies pay in advance for future supply of wholesale electricity and sell it to their customers with a mark-up. Retail prices are regulated by governments, which set an annual price cap.Amber, which was founded in 2017, instead charges a monthly subscription fee of $22, or $264 a year. It installs smart meters on the homes of customers, who then use its app to see the wholesale spot price and plan their electricity use around cheaper times.

After signing on with Amber, he says he no longer pays for electricity use and can make up to $300 in a night. Maguire says his most recent battery, which cost $11,500, will pay for itself in 5½ years. “If you’re on a fixed income and rely on stable and predictable electricity bills every month, then a traditional flat-rate plan might be better for you,” the company’s website says.

 

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