Locking in fairer electricity prices
The Morrison Government’s Default Market Offer (DMO) price cap is continuing to deliver fairer electricity prices for consumers.
The DMO was introduced on 1 July 2019 to lock in fairer electricity prices for customers across New South Wales, South Australia and south-east Queensland who are on standing offer contracts.
It was designed to protect loyal customers from excessively high standing offer contracts, while also acting as a reference price to make it easier for customers to compare offers from different retailers.
To ensure loyal customers continue to receive low energy deals, the Government is reviewing the impact of the DMO.
The review will consider how consumers have benefitted from the DMO and the extent to which they have become more engaged in the market as a result of the reference price.
Since the introduction of the DMO and with the latest DMO for 2021-22, average residential customers who were on standing offers prior to the DMO, will see their bills fall by up to $780 in 2021-22 compared to what they would have paid before the DMO.
Similarly, average small business customers remaining on standing offers could be up to $3,105 better off in 2021-22.
Importantly, the median market offer has also continued to decrease by up to 13.2 per cent over the two-year period.
The DMO is one of the Morrison Government’s key energy reforms to put downward pressure on prices to ensure access to affordable electricity and put more money back in the pockets of hardworking Australians.
The Australian Competition and Consumer Commission’s fifth report of its ongoing inquiry into the National Electricity Market confirmed that the DMO continues to deliver strong results, with customers on standing offers paying less for their electricity.
The Government welcomes input from electricity customers into how the DMO functions to ensure it continues to deliver positive outcomes for Australian households and businesses.
To contribute to the consultation process, visit the Department’s consultation website.
Submissions are open until 11 October 2021.
Minister Taylor's office 02 6277 7120