Short answer: As of early 2025, Queensland typically has the cheapest average residential electricity prices in Australia, thanks to its government-owned generators and retail subsidies. But for businesses? The cheapest rates depend heavily on your contract—and that’s where an energy broker can change the game.
Why do power prices vary so much between states?
If you’ve moved between states—or even just compared bills with a mate in another city—you’ve probably noticed how wildly different electricity prices can be.
There are a few big reasons why:
- Market structure: Some states have deregulated energy markets (like Victoria), while others (like Queensland) still have strong government ownership in play.
- Fuel mix: States that rely more on coal or gas might see higher prices depending on global commodity shifts.
- Transmission costs: Power doesn’t come cheap when it’s travelling long distances through ageing wires.
In short, your postcode plays a pretty big role in what you pay.
Which state really has the cheapest electricity?
As of the most recent AEMC and government reports, here’s the rough breakdown for average residential tariffs (based on annual usage of 4,000–5,000 kWh):
| State | Average c/kWh | Notes |
|---|---|---|
| Queensland | 21–23 cents | Regional subsidies keep costs low |
| Tasmania | 22–24 cents | Hydro helps, but demand is smaller |
| Victoria | 25–27 cents | Fully privatised, competitive market |
| South Australia | 27–29 cents | High renewables but costly grid |
| New South Wales | 25–28 cents | Pricing swings by region |
Now here’s the thing no one tells you: These averages are just that—averages. What you pay could be wildly different based on:
- Who your retailer is
- What kind of plan you’re on
- Whether you’re a household or business
That’s where comparing apples with oranges becomes an art form.
How do business power prices compare?
Here’s where it gets murky.
Businesses don’t just get a bill like households do. They’re often offered custom pricing, based on usage patterns, demand charges, and load profiles. So, while a small café in Brisbane might pay less per kWh than one in Sydney, a large cold-storage warehouse in rural Victoria might strike a better long-term deal—if they’ve got the right negotiation in place.
Most businesses don’t realise just how negotiable power is. And that’s exactly why many turn to an energy broker to do the heavy lifting.
What does an energy broker actually do?
If you’ve ever tried deciphering an energy contract—demand charges, time-of-use tariffs, lock-in clauses—you know it’s about as enjoyable as reading the terms and conditions on your phone plan. That’s the catch.
An energy broker helps businesses cut through all that noise. Think of them as your middleman:
- They know which retailers are offering what, and to whom.
- They know the traps in the fine print.
- And they’ve got the negotiation leverage you probably don’t.
Anyone who’s run a multi-site business or managed utilities for a venue knows the frustration of inconsistent pricing and billing. A good broker can wrangle all that into a clean, strategic energy contract—sometimes shaving thousands off your annual cost.
Why Queensland often comes out cheapest
Back to the original question: Why is Queensland the consistent frontrunner for low electricity costs?
Three reasons:
- Government-owned generators: The state owns a chunk of its energy infrastructure, meaning there’s more direct price control.
- Regional rebates: Households and small businesses in regional QLD receive government subsidies to offset distribution costs.
- Lower peak demand pressure: In many areas, especially outside the southeast, demand is steadier—putting less stress on grid prices.
But don’t be fooled. Even in Queensland, retail pricing for businesses can swing dramatically based on how sharp your contract is. That’s why a smart energy broker can still make a big difference, even in the “cheapest” state.
What about solar states like South Australia?
Good question.
South Australia leads the country in rooftop solar and renewable penetration. On sunny days, they’re practically running on sunshine. But weirdly enough, they still have some of the highest retail power prices.
Why?
Because the grid still needs to pay for:
- Backup generation when the sun isn’t shining
- Storage and grid stabilisation costs
- A pretty hefty network charge baked into bills
In short, solar helps—but it doesn’t magically erase the cost of delivering reliable power.
Is switching states worth it?
You might laugh, but this question does come up—especially for remote or border-town businesses. If you’re right near the NSW/VIC border, could a change in address save your café or office thousands a year?
Technically, yes… but practically? Not so much.
Energy pricing varies not just by state, but by distribution zone—so unless you’re physically relocating, you’re stuck with whatever pricing tier applies to your area. Again, this is where the right commercial plan, and a broker who knows the ropes, makes all the difference.
Final thoughts: Is the cheapest always the best?
Not necessarily.
Power plans with the lowest unit rates often sneak in other charges—daily supply fees, demand spikes, harsh exit clauses. Anyone who’s reviewed a few commercial contracts knows the devil’s always in the fine print.
So, while Queensland may wear the cheapest crown, the real winners are businesses who stay agile. Reviewing your contracts every 12–24 months. Getting competing quotes. Knowing what peak demand charges mean for your operations. Or better yet—handing all that off to someone who does.
Because in 2025, energy isn’t just a bill. It’s a strategy.
Related internal read: If you’re looking to streamline your power use across multiple sites or cut down costs through smarter tech integration, it’s worth exploring how business energy solutions help reduce overhead and boost operational efficiency.
