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Summer means lazy days spent at the beach, long nights with a cool beverage and in the electricity market, we look out for price spikes.
While buying power at wholesale prices is a cheaper way to get energy over the year, be aware that the wholesale market can be significantly more expensive for short periods of time.
A price spike occurs when the wholesale price climbs above $3/kWh - up to a maximum cap of ~$19 / kWh including GST, or up to ~$21 / kWh in SA. These occur each year and are typically caused by coal and gas power plants charging extremely high prices for energy when demand on the grid exceeds supply. For example, there is a higher likelihood of price spikes occurring in the early evening on very hot days, because this is when everyone gets home from work and runs their air conditioners.
All energy companies pay this higher wholesale price for the power they sell to their customers during price spikes - but most of them simply charge you higher rates year-round to cover their costs on the assumption that you'll use heaps of expensive and dirty power during these times. This means that with most traditional energy companies, you can still end up paying for price spikes even if you reduce your usage when they happen.
Amber gives you a unique opportunity to completely avoid paying these higher prices - both year-round, and when price spikes happen.
As an Amber customer, price spikes present a big opportunity to potentially save (or earn!) up to $150 in just a few hours!
By looking out for price spikes you can extract even more value from wholesale electricity rates. Take the typical usage for someone in VIC. Over a peak 3 hour period (Let’s say 5-8pm), they could be using up to 8 kWh of electricity by cranking large devices like air conditioners. In a worst case scenario, if they were to continue running their air conditioner and washing machine at the market price cap of $19 / kWh, then it would increase their bill in that month by ~$150.
Fortunately, at Amber, we’re committed to helping our customers get the cheapest possible power, and that means giving you the information you need to keep your bills down.
In the morning at 9am, we check if there's any forecast price spikes above ~$3/kWh in the wholesale market that day. We'll then send through an email, push notification and text message, letting you know when a price spike is expected.
Check the notification settings on your app to ensure these are toggled on.
We've had a few false alarms previously, where our system has incorrectly predicted a price spike. During these situations, it's still a good idea to follow your price spike strategy because the price did climb, just not enough for there to be a spike. You can also keep an eye on the app throughout the day, because this will indicate when a price spike is forecast to occur.
On rare occasions, unexpected price spikes happen. For example, VIC was suddenly impacted in January 2024 when storms damaged infrastructure, including key transmission lines.
In the event of an unexpected price spike, we'll send you an immediate alert.
You can save by limiting your energy use during a price spike, and there's lots of ways to do this. Here's some ideas:
If you have solar then you have an opportunity to export power and earn up to $19/kWh! For example, we had one customer in Victoria who earned over $500 in just a few hours during the Victoria price spike in 2024 by exporting power from their battery during a price spike.
The best way for savvy solar customers to take advantage of this is to reduce their electricity usage as much as possible (i.e. by following the ideas above), maximising the amount of power they are exporting to the grid. You could go out and enjoy that dinner and movie ticket on the wholesale electricity market!
The data below shows that in 2023 there were 3 price spikes in Victoria and 28 in SE QLD (Amber only services this part of the QLD). For more information on the frequency and duration of price spikes in the past year, check out this explainer.
Yep. To give you peace of mind we guarantee that over the course of each quarter you'll never pay more than our Bill Guarantee rates on average for your usage, or we will credit you the difference.
A couple of weeks before the start of each quarter we will set the rate for each network for the quarter, and let all our customers know. Winter months tend to have slightly higher and more volatile prices on average, so the guarantee rates that cover winter months will likely be higher than those that cover summer months.
You can find the Bill Guarantee rates for the current quarter here for customers in Victoria and here for customers outside Victoria.
The above strategies show why price spikes are a huge opportunity for Amber customers. While most customers will still save on their electricity with Amber, because wholesale prices are on-average much cheaper than retail rates, reducing your usage during these periods will help you save or earn even more. You'll also be helping improve the stability of the grid by reducing demand at peak times. The environmental benefits of this can't be understated, because reducing demand is a much better solution than building more fossil fuel-based power plants to limit the number of price spikes.
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Co-founder and CEO
