The Australian Energy Regulator (AER) and the Essential Services Commission (ESC) have announced their final decisions on the Default Market Offer (DMO) and Victorian Default Offer (VDO) for the 2024-25 period. But what do these changes mean for Australian businesses?
Understanding the DMO and VDO
The Default Market Offer (DMO) serves as a safeguard against inflated electricity prices for households and small businesses in South Australia, New South Wales, and South-East Queensland. Similarly, the Victorian Default Offer (VDO) plays a similar role for consumers in Victoria, regulated by the Essential Services Commission.
Both the DMO and VDO provide a benchmark price, ensuring fair electricity rates and protecting consumers from overpaying in a fluctuating market. These rates set the maximum amount that retailers can charge, offering a clear standard for price comparison.
What’s New for the 2024-25 Energy Rates?
Default Market Offer (DMO)
Most small business customers could see a reduction in their electricity bills, with decreases ranging from 1% to 9%. However, depending on the region, some businesses may face slight increases of around 1%.
Victorian Default Offer (VDO)
For small business customers in Victoria, the average annual bill is expected to drop by $261, which is about a 7% decrease compared to 2023-24. The most significant reduction is in the AusNet zone, with an average savings of $386.
These reductions in the DMO and VDO are largely due to changes in electricity network and wholesale costs, aiming to protect consumers after several years of market volatility. As AER Chair Clare Savage stated, “We understand that cost-of-living pressures are a priority for many households and small businesses, and we will continue to protect customers from unjustifiably high prices.”
How Can Your Business Navigate These Changes?
Handling energy price changes effectively requires strategic planning. Here are some key steps your business can take to stay on competitive rates:
- Regularly Compare Energy Plans
Ensure your business is on the most competitive energy plan available. Even with economic pressures, some retailers continue to offer better deals than others. Regularly comparing energy plans can lead to significant savings. - Get Expert Energy Advice
Consult with energy market experts who can provide personalised recommendations based on your business’s specific needs and usage patterns. As AER Chair Clare Savage emphasised, “Shopping around remains the best way to get the best price.”
If you’re currently on a default or standing offer, you don’t have to stick with it. Over 152,000 small Australian businesses are still on default market rates. Most of these businesses are not locked into their plans, meaning you can compare deals and switch to a market offer at any time. - Seize Seasonal Opportunities
Many Australian energy retailers re-evaluate their plans around July 1, often introducing new offers that include competitive rates, discounts, or welcome credits. This is an excellent time to explore what’s available and switch to a more cost-effective plan.
What’s Your Next Move?
At CheckYourBill, we’re dedicated to finding the most competitive energy rates for you or your business. Our team of Energy Experts specialises in energy comparisons for Australian businesses, ensuring you can navigate energy price changes smoothly and secure the best deal available.
Want to see if your rates could be more competitive? Fill out the contact form below, and let us help you find a better energy plan.
Don’t let energy price changes catch your business off guard. Stay informed, compare your options, and make the switch to a plan that better suits your needs.
