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It’s why we created the Price Efficiency Adjustment (PEA).
The wholesale electricity market is dynamic and changes based on supply and demand. Throughout the day, prices tend to be lower as solar generation floods the grid. Whereas, in the early morning and evening, due to higher energy demand, and low renewable availability increasing reliance on fossil fuels to supply the grid, driving prices higher.
With the PEA, if you use more energy when wholesale prices are low, your PEA will be lower, therefore, reducing your energy rate each month.
For Time of Use customers, please click the button below to learn more about your Price Efficiency Adjustments.
The PEA is a bill adjustment applied at the end of your billing period. Your monthly price will be updated to reflect how efficient your usage patterns were for the month against the average Flow Power residential energy user.
These calculations use information from metering data for each trading interval in that billing period.
The calculation of the PEA each billing period is:
PEA = CPEA – BPEA
Where the CPEA is Customer PEA, and BPEA is the Benchmark PEA and included in your base rate in the fact sheet.
Your Benchmark Price Efficiency Adjustment (BPEA) forms part of your base rate on your energy fact sheet. The BPEA broadly represents the average customer PEA of Flow Power residential customers.
In a nutshell, your Customer Price Efficiency Adjustment (CPEA) reflects how your home energy usage pattern performed against the wholesale market prices (the spot price) and the network usage charges.
LWASP is your electricity load weighted average spot price in a billing period (one month), it is calculated by:
Below is an illustrative example of this calculation assuming that there are only 3 Trading Intervals in a billing period (note that trading intervals are currently 5 minutes each and a typical billing period is about a month, so this is a very simplified example):
| Trading Interval | Spot Price | Usage |
| 1 | 5 c/kWh | 5 kWh |
| 2 | 10 c/kWh | 3 kWh |
| 3 | 20 c/kWh | 2 kWh |
Based on the above example, the LWASP will be calculated as follows:
= [ (5 x 5) + (10 x 3) + (20 x 2)] / (5 + 3 + 2) = 9.5 c/kWh
TWASP is the time weighted average spot price in a billing period calculated by:
Below is an illustrative example of this calculation based on the hypothetical example (provided under LWASP) of 3 trading intervals in a billing period:
Based on this example, the TWASP will be calculated as follows:
= (5 + 10 + 20) / 3 = 11.7 c/kWh
Based on the above LWASP and TWASP calculations, we subtract the two totals to get the CPEA.
LWASP – TWASP = CPEA
9.5 c/kWh – 11.7 c/kWh = – 2.2 c/kWh
Therefore in this example the CPEA = -2.2 c/kWh
In the above case, the CPEA is negative. We then minus the BPEA. For this example, we will use an BPEA of 2.5 c/kWh:
CPEA – BPEA = PEA
Therefore:
-2.2 c/kWh – 2.5 c/kWh = -4.7 c/kWh
We now have a PEA of -4.7c/kWh, which means you receive a reduction in your base rate that month. If the base rate was 30 c/kWh, your final rate would be calculated as follows.
Base Rate + PEA = Electricity Price
Therefore:
30 c/kWh + (-4.7 c/kWh) = 25.3 c/kWh
With a negative PEA, the new base rate would be 25.3 c/kWh
If your LWASP exceeded the TWASP AND the BPEA, your PEA that month would be positive, increasing your base rate.
Using the 2.5 c/kWh BPEA from above, and an example positive CPEA of 3.7 c/kWh, your PEA would be:
CPEA – BPEA = PEA
Therefore:
3.7 c/kWh – 2.5 c/kWh = 1.2 c/kWh
We now have a PEA of 1.2 c/kWh, which will mean that you receive an uplift to your base rate that month. If the base rate was 30 c/kWh, your final rate would be calculated as follows;
Base Rate + PEA = Electricity Price
Therefore;
30 c/kWh + 1.2 c/kWh = 31.2 c/kWh
With a positive PEA, the new base rate would be 31.2 c/kWh
