We are reviewing the Victorian Default Offer prices to apply from 1 July 2024 to 30 June 2025.
Victorian Default Offer price review 2024–25
Request for comment paper2 November 2023
Submissions close14 December 2023
Draft decision paperMarch 2024
Public forumMarch/April 2024
Final decision paperMay 2024
New prices in effectJuly 2024
We are responsible for setting and annually reviewing the Victorian Default Offer prices. The default offer is designed to be a simple, trusted and reasonably priced electricity option that safeguards customers that are unwilling or unable to engage in the market.
We have commenced our consultation on the Victorian Default Offer prices to apply from 1 July 2024 to 30 June 2025.
Our request for comment paper proposes to keep our approach to setting the Victorian Default Offer prices largely unchanged. While we propose to use largely the same methodology, we will update our cost benchmarks with the most recent data available when making our draft and final decision.
We plan to release our draft decision in March 2024 and our final decision in May 2024.
Have your say on our approach to setting default offer prices to apply from 1 July 2024
We are seeking stakeholders' views on the Victorian Default Offer
Comments and formal submissions to our request for comment paper should be made by 14 December 2023 via Engage Victoria.
Among other things, we are seeking feedback on:
- new instruments and strategies that retailers are now using to manage peak wholesale price risks in place of peak swap contracts;
- alternative approaches we could consider in setting the retail operating margin.
Request for comment paper
How we calculate the Victorian Default Offer
We are required to base the Victorian Default Offer on the efficient costs of the sale of electricity by a retailer. In past reviews we have done so by considering:
- wholesale electricity costs – based on the price of electricity costs in the futures market
- network costs – taken directly from tariffs approved by the Australian Energy Regulator
- environmental costs – taken from public information on the costs of environmental initiatives
- retail costs – based on the customer weighted average of retailers' actual costs
- other costs – taken directly from published reports from industry bodies
- network losses – taken from the Australian Energy Market Operator and electricity distributors
- retail operating margin – based on a benchmark from comparable regulatory decisions.
Feedback on our request for comment paper closes on Thursday 14 December 2023.
We will review feedback on our request for comment paper and plan to release a draft decision in March 2024.
We will hold a public forum (online) also in March (or April). We will update this page with more information on the forum including how to register, closer to the event.