In response to recommendations made by the independent bipartisan review of electricity and gas retail markets in 2018, we provided advice to the Victorian Government on the price for the Victorian Default Offer that was introduced on 1 July 2019.
Victorian Default Offer recommendation 2019
Staff working paper21 December 2018
Draft advice8 March 2019
Public forum25 March
Submissions close4 April 2019
Final recommendationMay 2019
The Victorian Default Offer allows every Victorian household and small business to ask for a default offer from their electricity retailer from 1 July 2019. We were responsible for recommending to the Victorian Government what the offer (price) should be.
The Victorian Government has released our final advice on the Victorian Default Offer to apply from 1 July 2019, in response to the terms of reference issued in December 2018.
Final advice to the Victorian Government
Correction to final advice to the Victorian Government
What is the Victorian Default Offer?
Under legislation passed in the Parliament of Victoria and rules set by Governor in Council Orders, every Victorian household and small business (with the exception of embedded network customers) will be able to ask for a default offer from their electricity retailer from 1 July 2019.
From 1 July to 31 December 2019, the price of electricity under the Victorian Default Offer is based on our advice, and is not set by energy companies. Most customers on a standard contract (or standing offer) will receive the Victorian Default Offer on 1 July. Electricity retailers may continue to offer customers contracts that differ from the Victorian Default Offer, through market offers.
What does our final advice mean for electricity bills?
The first Victorian Default Offer price will be set for the period from 1 July 2019 to 31 December 2019.
Customers on standing offers
Bills should have generally fallen from 1 July 2019 under our final advice. The bill impacts for households and small businesses will vary depending on their electricity use, distribution zone, and their current tariffs.
But for residential customers using 4 000 kWh per year, we estimate bill savings could range from $310 to $450 per year (the approximate difference between our final advice on the Victorian Default Offer price, and the current median standing offer).
Customers on market offers
You may also benefit from the Victorian Default Offer.
Customers should contact their electricity retailer to check they are on a plan that suits their circumstances. From 1 July 2019 this could be the Victorian Default Offer, or it could be a different plan that offers a better deal.