How to Compare Electricity Plans Using Your Annual Usage
The only way to know whether a bigger discount actually saves you money is to do the arithmetic. This article runs one household's annual usage through two hypothetical offers, in full, so you can see exactly where the numbers land and run the same calculation on your own.
Why this article is one worked example, not another checklist
Our main guide to electricity in Ireland already sets out the fuller list of things that separate one plan from another: contract length, exit fees, payment method conditions, smart meter eligibility and renewable claims. Rather than repeating that list, this article does the one thing a list cannot: it shows the actual arithmetic behind the advice that a smaller discount can still be the cheaper plan, using one household's usage and two hypothetical offers, worked all the way through to a euro figure.
The household: one annual usage figure
Say a household's most recent bill or online account shows an annual usage of 4,100 kWh. This figure is illustrative, chosen only to make the arithmetic concrete, not a claim about what a typical Irish household uses. Your own figure, taken from your own bill or supplier account, is the only one that matters when you run this calculation for real.
Two hypothetical offers
Say two suppliers quote the following. Neither of these is a real tariff from any supplier. The unit rates, discounts and standing charges are round numbers chosen to make the calculation easy to follow.
| Charge | Plan A | Plan B |
|---|---|---|
| Unit rate | 42c per kWh | 40c per kWh |
| Discount on the unit rate, first 12 months | 15% | 10% |
| Standing charge | €280 per year | €220 per year |
On the headline discount alone, Plan A looks like the better offer: 15% off against Plan B's 10%. The calculation below shows why that comparison is not enough on its own.
Year one: while the discount applies
Applying each plan's discount to its unit rate gives a discounted rate of 35.7c per kWh for Plan A (42c reduced by 15%) and 36c per kWh for Plan B (40c reduced by 10%). Multiplying each discounted rate by the household's 4,100 kWh usage gives the electricity portion of the bill: €1,463.70 for Plan A and €1,476.00 for Plan B. Adding each plan's standing charge gives a first year total of €1,743.70 for Plan A and €1,696.00 for Plan B.
Despite its smaller discount, Plan B works out about €48 cheaper over the first year, because its lower standing charge more than makes up the difference in the discounted unit rate.
A real bill also includes VAT and the PSO levy, both explained in our guide to unit rates, standing charges and discounts explained. They are left out of this calculation because they apply in the same way regardless of supplier, so they do not change which of two plans is cheaper relative to each other, only the final total on an actual bill. When comparing two real offers, ask each supplier for a total estimated annual cost that already includes both, rather than adding them yourself.
Year two: once the discount ends
Most discounts of this kind apply only for an introductory period, commonly the plan's first 12 months, after which the unit rate reverts to its undiscounted figure. Repeating the same calculation at the full unit rate gives an electricity portion of €1,722.00 for Plan A and €1,640.00 for Plan B, and a second year total of €2,002.00 for Plan A against €1,860.00 for Plan B.
The gap between the two plans widens once the discount ends, from about €48 in year one to about €142 in year two, because Plan A's higher standing charge and higher underlying unit rate are both working against it once the discount that was masking them disappears.
Want help running this comparison with your own figures?
A member of the comparison team can call you to go through the electricity plans available through its service.
What decided the result, and what did not
The discount percentage, the number both plans led with, decided nothing on its own. What decided the result was the standing charge and the underlying unit rate once discounted, applied to this household's actual usage. A household with much lower usage than 4,100 kWh would weight these figures differently, since the standing charge makes up a larger share of a smaller bill; a household with much higher usage would weight them differently again, since the unit rate then dominates. This is exactly why an offer has to be run through your own usage figure to mean anything, rather than compared on the discount headline alone.
What this worked example does not cover
This calculation assumes a single, flat unit rate for the full year and a household whose usage does not change month to month, neither of which is exactly true for a real household, since usage typically varies by season and a time of use tariff would need a different calculation entirely, covered in our guide to smart meters and time of use tariffs explained. It also does not cover contract length, exit fees, payment method conditions, or renewable claims, none of which show up in this arithmetic but all of which still affect whether an offer is actually worth signing up to. Our main guide to electricity in Ireland sets out that fuller checklist, along with what to have ready before you switch and what happens when you switch supplier.
Running this calculation on your own two offers
- Your own annual usage in kWh, from a recent bill, annual statement or online account, not an example figure
- The unit rate and standing charge for each offer, quoted separately from the discount
- What portion of the bill each discount applies to, and for how long it lasts
- The discounted unit rate for each plan, multiplied by your usage, plus the standing charge, for the discounted period
- The same calculation again at the full unit rate, for once the discount ends
- A total estimated annual cost requested directly from each supplier, including VAT and the PSO levy, to check against your own figures
For everything this worked example leaves out, including contract terms, meter eligibility and what to have ready before you switch, see our main guide to electricity in Ireland.
