There are two important pieces of legislation that will be introduced for residential and small businesses in all states of the National Electricity Market (NEM) from 1st July 2019. In Victoria, the state government have legislated the Victorian Default Offer (VDO) and in New South Wales, South Australia and Queensland the Australian Energy Regulator (AER) have legislated the Default Market Offer (DMO).
Both new pieces of legislation have been introduced to provide protection to customers that were previously paying high standing offer rates and provides a reference price for "percentage off" discounts. These changes adopt recommendations raised in the Retail Electricity Pricing Enquiry conducted by the Australian Competition and Complaints Commission (ACCC) last year.
What do these changes mean for your business?
From 1 July you should see default offers available from your energy retailer and referenced on your electricity bill. Customers currently on standing offers will automatically be rolled onto the new default offers.
The overall impact of this change remains to be seen, with smaller electricity retailers raising concerns that regulating pricing will actually reduce competitiveness of the market.