Victorians will soon be better protected from paying more than they should for energy, with new rules commencing to help end the ‘loyalty tax’ for long-term customers.
Energy retailers must now start identifying customers who have been on the same plan for more than four years and start taking steps to move them onto a cheaper plan if they are no longer paying a reasonable price.
The new rule is designed to help address a long-standing practice where retailers attract new customers with discounted offers, while existing customers remain on older, more expensive plans.
An analysis from the Essential Services Commission in 2025 found that customers who had stayed on the same plan for two years or more could have saved up to $410 a year by being on their retailer’s cheapest plan. Customers who had not changed plans for more than 10 years could have saved up to $950 each year.
To work out whether a customer is on a reasonable price, retailers must consider current offers, market prices and the Victorian Default Offer.
This reform is part of a broader suite of upcoming changes to energy rules to help Victorians get the best price and stay connected. From 1 July, retailers must also:
proactively ensure customers receive any energy bill concession they are entitled to
limit additional retail charges and conditional discounts for all contracts to a reasonable cost.
From 1 October, retailers must:
automatically move customers experiencing payment difficulty to their best plan
increase the minimum debt threshold for disconnection from $300 to $1000.
