The average annual electricity bill in Australia sits somewhere between about $1,590 and $2,600 a year, depending on which state and which network area you live in. The regulators set a reference bill each year, and for 2026-27 those figures run from $1,591 in Victoria to $2,604 in regional New South Wales.
That spread is the first thing most guides skip. The second is that a big chunk of your bill has nothing to do with how much power you use, which means solar cannot touch it. This guide gives you the real numbers, breaks a bill into its parts, and shows honestly what solar removes and what it leaves behind.
Average electricity bill by state in 2026
The most reliable “average” bills in Australia are the regulated reference prices. In New South Wales, South East Queensland and South Australia the Australian Energy Regulator sets the Default Market Offer. In Victoria the Essential Services Commission sets the Victorian Default Offer. Western Australia and Tasmania set their own regulated prices.
| Region | Reference bill 2026-27 | Change on last year | Who sets it |
|---|---|---|---|
| NSW, Ausgrid (Sydney, Hunter, Central Coast) | $1,899 | Down 3.4% ($66) | AER |
| NSW, Endeavour Energy (western Sydney, Illawarra) | $2,328 | Down 3.4% ($83) | AER |
| NSW, Essential Energy (regional NSW) | $2,604 | Down 5.0% ($137) | AER |
| South East Queensland, Energex | $1,988 | Down 7.2% ($155) | AER |
| South Australia, SA Power Networks | $2,334 | Up 1.4% ($33) | AER |
| Victoria, average of five zones | $1,591 | Down 5% ($84) | ESC |
| Western Australia, Synergy Home Plan A1 | About $1,766 at 4,000 kWh | Up 2.75% | WA Government |
| Tasmania, Aurora standing offer | Not published as one figure | Up 4.23% | Aurora Energy |
Sources: AER final Default Market Offer 2026-27, released 26 May 2026. ESC Victorian Default Offer 2026-27 final decision, 20 May 2026. Aurora Energy, prices from 1 July 2026. WA regulated tariffs are set by the State Government through Energy Policy WA; Home Plan A1 charges from 1 July 2026 are 119.24 cents a day and 33.26 cents per kWh, a 2.75% rise. The WA total is our own sum of those two rates at 4,000 kWh a year.
One warning before you compare these numbers. The AER uses a different representative usage level for each network area, based on what people in that area actually use. Sydney’s figure assumes 3,900 kWh a year. Regional New South Wales assumes 4,600 kWh. So the gap between zones is partly price and partly how much power people use. It is not a like-for-like comparison.
What is actually in your bill
Your retailer sells you electricity, but most of what you pay is passed straight through from someone else. The Essential Services Commission publishes the full cost build-up for the Victorian Default Offer. Here is where $1,591 a year goes for a Victorian household using 4,000 kWh.
| Part of the bill | Cost a year | Share | Does solar reduce it? |
|---|---|---|---|
| Network costs (poles, wires, meters) | $603 | About 38% | Only the part charged per kWh |
| Wholesale electricity | $491 | About 31% | Yes |
| Environmental schemes | $62 | About 4% | Yes, mostly |
| Retail operating costs | $150 | About 9% | No, charged per customer |
| Customer acquisition and retention | $48 | About 3% | No, charged per customer |
| Retail margin | 5% of the cost stack | Follows whatever is left | |
| Market fees, licence fees, network losses, GST | The remainder | Mixed |
Source: Essential Services Commission, Victorian Default Offer 2026-27 Final Decision Paper, 20 May 2026. Component figures exclude GST. The $1,591 total includes GST.
Network costs are the single biggest item at about 38%. That surprises people who assume they are mostly paying for the electricity itself.
The part solar cannot touch
Every bill has two charges. A usage charge for each kilowatt hour you take from the grid, and a daily supply charge you pay whether you use power or not.
The AER is blunt about how it splits them. In its final DMO determination it states that it has “assigned recovery of fixed costs to the daily supply charge and recovery of variable costs to the usage charges”. The ACCC puts the customer’s side of it just as plainly: the supply charge is charged each day “whether they use electricity from the grid or not (for example, when on holiday or if only using electricity from a solar and battery system)”.
So the supply charge is the floor. Here is how big that floor is under the 2026-27 reference prices.
| Network area | Daily supply charge | Fixed cost a year | Usage rate | Assumed usage | Annual bill | Fixed share |
|---|---|---|---|---|---|---|
| Ausgrid (Sydney) | 166.2c | $607 | 33.1c/kWh | 3,900 kWh | $1,899 | 32% |
| Endeavour Energy | 185.1c | $676 | 33.7c/kWh | 4,900 kWh | $2,328 | 29% |
| Essential Energy (regional NSW) | 272.2c | $994 | 35.0c/kWh | 4,600 kWh | $2,604 | 38% |
| Energex (South East Qld) | 192.0c | $701 | 28.0c/kWh | 4,600 kWh | $1,988 | 35% |
| SA Power Networks | 180.1c | $657 | 41.9c/kWh | 4,000 kWh | $2,334 | 28% |
These are the 2026-27 Default Market Offer reference tariffs, including GST. We checked every row: the supply charge times 365, plus the usage rate times the assumed usage, matches the AER’s published annual figure to within a couple of dollars. The Ausgrid rate also matches a retailer rate schedule published for Ausgrid customers from 1 July 2026.
Victoria is cheaper on this measure. Using the ESC’s own published formula and inputs for 2026-27, the supply charge works out at roughly $1.00 to $1.14 a day depending on the zone, or about $365 to $417 a year. That is 23% to 26% of the average Victorian bill.
The point is simple. A household in regional New South Wales pays close to $1,000 a year before using a single kilowatt hour. A 20 kW system on the roof would not shift that number by one cent. Anyone who tells you solar will wipe out your bill is either ignoring the supply charge or hoping you will.
Why bills vary so much between states
Three things drive the gap. Network costs come first. Regional networks run many more kilometres of wire per customer, so the cost per household is higher. Essential Energy covers most of country New South Wales, and its supply charge is 64% higher than Ausgrid’s in metropolitan Sydney.
Wholesale prices come second. Each state has a different generation mix, and South Australia has historically had higher and more volatile wholesale prices. It is the only DMO region where residential prices went up for 2026-27.
Usage comes third. Households in hotter or colder climates run more heating and cooling, which is why the AER sets a different representative usage level for each area.
What has happened to prices recently
For 2026-27, most regulated prices fell. The AER cut residential flat rate prices by 3.4% to 5.0% in New South Wales and 7.2% in South East Queensland, with a 1.4% rise in South Australia. Victoria fell 5%. AER Chair Clare Savage attributed the reductions to “lower electricity contract prices, reduced spot price volatility, and increased output from wind and battery generation during evening peaks”.
Two things pull the other way for solar owners.
Network costs rose in many areas even as the total bill fell, and network costs are what sit behind the daily supply charge. Some retailers lifted supply charges sharply from 1 July 2026 while cutting usage rates. That combination is worse for a low-usage or high-solar household than a high-usage one.
Feed-in tariffs have also collapsed. The ACCC found that median effective feed-in rates fell from about 4.3 to 8 cents per kWh in the September quarter of 2024 to between about 1.9 and 4.3 cents by the September quarter of 2025. Our guide to solar feed-in tariffs in Australia covers what that means for new systems.
One new option helps. From 1 July 2026 retailers must offer a Solar Sharer Offer, an opt-in plan for smart meter households giving three hours of free electricity in the middle of the day. If you can move your washing, dishwasher or car charging into that window, it is worth asking your retailer about.
Before and after solar: a realistic example
Here is a worked example for a Sydney household on the Ausgrid reference price. The system is 6.6 kW, the most common size in Australia.
For generation we use the Clean Energy Regulator’s postcode zone rating, which is the deemed output figure used to calculate solar rebate certificates. Sydney is zone 3, rated at 1.382 megawatt hours per kW per year, so 6.6 kW is deemed to produce about 9,120 kWh a year. Real output is often lower once shade, dust, roof angle and inverter losses are counted, so treat it as an upper bound.
| Line on the bill | Before solar | With solar, no habit change | With solar, usage shifted to daytime |
|---|---|---|---|
| Daily supply charge | $607 | $607 | $607 |
| Grid electricity bought | 3,900 kWh, $1,291 | 2,730 kWh, $904 | 1,950 kWh, $645 |
| Feed-in credit | $0 | Minus $239 | Minus $215 |
| Total for the year | $1,899 | $1,272 | $1,037 |
| Saving | $627, or 33% | $862, or 45% |
This is our own calculation, not a measured result. The inputs are the AER’s 2026-27 Ausgrid reference tariffs, the CER zone rating, a feed-in rate of 3 cents per kWh (within the ACCC’s measured range for the September quarter of 2025), and an assumption that solar covers 30% of household usage without habit changes and 50% with. Your own numbers will differ.
Notice what does not move. The supply charge is identical in all three columns. Feed-in credits can offset it on paper, but the charge itself never goes away.
What the real-world data says
Modelled savings and measured savings are not the same thing, and this is where the post has to be honest with you.
The ACCC tracks actual bills from retailers covering 89% of residential customers in New South Wales, Victoria, South Australia and South East Queensland. In its June 2026 report on the National Electricity Market, published 10 July 2026, it found that solar customers have historically had lower bills than non-solar customers, but that the gap has narrowed sharply since 2024. It puts falling feed-in tariffs at the centre of that.
Two other findings matter. Solar households buy more electricity from the grid than non-solar households, not less, which tells you these are often larger homes with higher total demand. And the ACCC says it cannot measure self-consumption at all, because it happens behind the meter. That is exactly why savings estimates vary so much between sources, including ours.
Adding storage changes the picture more clearly. The ACCC found that in 2025-26, households with solar and a battery had median annual bills $329 to $909 lower than customers with neither, a reduction of 20% to 52%. Households in a virtual power plant were $762 to $1,093 lower, or 57% to 63%. More than 402,700 batteries were installed under the federal Cheaper Home Batteries Program between 1 July 2025 and 17 May 2026. If storage is on your list, start with the solar battery rebate guide.
How to cut the part solar cannot reach
You cannot remove the supply charge, but you have some control over it.
Compare plans. Supply charges vary a lot between retailers on the same network. The AER’s free Energy Made Easy site lets you compare on your actual usage, and retailers must tell you at least once every 100 days if they have a better plan for you.
Check your tariff type. The ACCC found that in the September quarter of 2025, customers on time of use tariffs without a controlled load paid 14% more than flat rate customers, and demand tariff customers paid 40.9% more.
Size the system to your daytime usage rather than to your roof. With feed-in rates near 2 to 4 cents and usage rates near 28 to 42 cents, a kilowatt hour you use yourself is worth roughly ten times one you export. Our guide on how many solar panels you need walks through sizing, and how to compare solar quotes covers what to check before you sign. You can also browse installers in our directory.
Frequently asked questions
What is the average quarterly electricity bill in Australia?
Divide the regulated annual reference prices by four and you get roughly $400 to $650 a quarter, depending on your state and network area. Victoria is at the low end at about $398 a quarter, and regional New South Wales at the high end at about $651, based on the 2026-27 reference prices.
Can solar reduce my bill to zero?
Not by itself. The daily supply charge stays no matter what, and it is 23% to 38% of a regulated bill depending on where you live. Large feed-in credits can push a bill into credit in some months, but the charge is still being levied.
Why did my supply charge go up when prices were supposed to fall?
Network costs rose in many areas for 2026-27 even though wholesale and environmental costs fell. Because the daily supply charge recovers fixed network costs, some retailers raised it while cutting usage rates. Households that use less power, including solar households, feel that change more.
Is a bigger solar system always better for cutting my bill?
Not if most of the extra output is exported. Exports earn about 2 to 4 cents per kWh, while grid power costs 28 to 42 cents. Beyond the point where you can use the power yourself, extra panels mostly buy you feed-in credits at a low rate.
Does a battery cut more of the bill than solar alone?
The ACCC’s measured data says yes. Households with solar and a battery had median bills 20% to 52% lower than customers with neither in 2025-26, while the gap between solar-only and non-solar households has narrowed. A battery still cannot remove the supply charge.
Related reading
About this research
This is independent desk research by Solar Cobber. We did not visit sites, request quotes or accept payment for inclusion. Figures are dated and sourced, and pricing and policy details change, so confirm current terms directly before you sign anything.