It’s good news after the other. On the heels of the Victorian Default Offer (VDO), the Default Market Offer (DMO) will change on July 1st, with the reference price for electricity falling as much as $155 in NSW and QLD.
Unluckily for SA customers, the reference price in their state is slated to increase by $33.
What is the Default Market Offer?
The DMO refers to the annual reference prices set by the Australian Energy Regulator (AER) for NSW, QLD and SA every July 1st, limiting the max price retailers can charge on a standing offer — a mandatory plan customers are moved to if their old plan has expired.
The reference price shields Aussies who are inactive in the energy market from being overcharged for electricity. It’s also a baseline for customers to compare retailer-designed plans (market offers) and for retailers to set their own plans’ rates.
How much less could Australians pay for electricity from July?
When setting reference prices, the AER takes these factors into account: wholesale energy costs, network costs, environmental costs, retail margins and annual usage estimates between networks in each state.
Because these costs differ greatly between electricity networks and states, so do their reference prices.
Flat rate tariffs
A flat rate (or single rate tariff) charges a fixed usage rate (the cost of every kilowatt hour of electricity you use) throughout the day.
Flat rate tariff electricity price changes: 2026 - 2027 | |||||
Electricity network | State | Previous DMO | DMO 2026 - 2027 | Price difference ($) | Price difference (%) |
Ausgrid | NSW | $1,965 | $1,899 | - $66 | - 3.4% |
Endeavour Energy | NSW | $2,411 | $2,328 | - $83 | - 3.4% |
Essential Energy | NSW | $2,741 | $2,604 | - $137 | - 5.0% |
Energex | South East QLD | $2,143 | $1,988 | -$155 | - 7.2% |
SA Power Networks | SA | $2,301 | $2,334 | + $33 | + 1.4% |
Source: DMO 2026–27 final determination, May 2026. | |||||
Queenslanders are the biggest winners, who can expect to save $155 on their power bills in the 2026 - 2027 financial year. Unfortunately, South Australians may end up $33 out of pocket.
The AER is also introducing a rate cap on daily supply and usage charges, offering more protection to customers against excessive pricing.
Supply charges are a daily fixed cost you pay to remain connected to the grid.
Flat rate cap | |||
Electricity network | State | Usage charge cap ( (c/kWh) | Supply charge cap ($/day) |
Ausgrid | NSW | 33.14 | 1.66 |
Endeavour Energy | NSW | 33.73 | 1.85 |
Essential Energy | NSW | 35.01 | 2.72 |
Energex | South East QLD | 27.97 | 1.92 |
SA Power Networks | SA | 41.90 | 1.80 |
Source: DMO 2026–27 final determination, May 2026. | |||
Time of use tariff
Historically, reference prices were exclusive to flat rate tariffs. For the first time, the upcoming DMO will introduce time of use (ToU) reference prices.
A ToU tariff charges varied electricity rates at different times of the day.
Because this is a new price category, we can only compare it against last year’s flat rate reference price. Keep in mind that it is an apples-to-oranges comparison:
Time of use electricity price changes: 2026-27 | |||||
Electricity network | State | Previous DMO (Flat rate) | DMO 2026 - 2027 (ToU) | Price difference ($) | Price difference (%) |
Ausgrid | NSW | $1,965 | $1,893 | −$72 | (−3.7%) |
Endeavour Energy | NSW | $2,411 | $2,320 | −$91 | (−3.8%) |
Essential Energy | NSW | $2,741 | $2,530 | −$211 | (−7.7%) |
Energex | Southeast QLD | $2,143 | $1,914 | −$229 | (−10.7%) |
SA Power Networks | SA | $2,301 | $2,276 | −$25 | (−1.1%) |
Source: DMO 2026–27 final determination, May 2026. | |||||
Similar to the flat rate tariff, ToU electricity rates will have their own price caps set:
ToU rate cap | ||||||
Electricity network | State | Usage charge cap | Supply charge cap ($/day) | |||
Shoulder periods (c/kWh) | Off-Peak periods ( (c/kWh) | Peak periods ( (c/kWh) | Solar Soak period ( (c/kWh) | |||
Ausgrid* | NSW | - | 24.04 | 60.20 | - | 1.76 |
Endeavour Energy | NSW | - | 35.69 | 46.5719 (low season charge) 47.1379 (high season charge) | 12.35 | 1.85 |
Essential Energy | NSW | - | 24.14 | 42.12 | - | 2.72 |
Energex | Southeast QLD | 25.30 | 6.99 | 47.79 | - | 1.78 |
SA Power Networks | SA | - | 32.55 | 56.22 | 17.04 | 1.80 |
Source: DMO 2026–27 final determination, May 2026. *Ausgrid does not have peak periods in April, May, September and October. | ||||||
A shoulder period refers to the hours between peak and off-peak hours, while a ‘solar soak’ period charges cheaper usage rates when solar generation peaks on the grid.
Solar sharer offer
The Solar Sharer Offer (SSO) is a new standing offer with three hours of free electricity (capped at 24kWh) for the following hours:
- NSW and South East QLD: 11am - 2pm
- SA: 12pm - 3pm
Starting July 1st, retailers with more than 1,000 residential customers must offer an SSO standing offer as an optional opt-in, with the non-SSO standing offer as the default choice.
Like ToU standing offers, the SSO is a new reference price with nothing similar to compare it to.
SSO reference price | ||
Electricity network | State | DMO 2026 - 2027 (SSO) |
Ausgrid* | NSW | $1,893 |
Endeavour Energy | NSW | $2,320 |
Essential Energy | NSW | $2,530 |
Energex | Southeast QLD | $1,914 |
SA Power Networks | SA | $2,276 |
Source: DMO 2026–27 final determination, May 2026. | ||
However, the AER has also imposed price restrictions on its rates outside of the free electricity window:
SSO rate cap | ||||||
Electricity network | State | Usage charge cap | Supply charge cap ($/day) | |||
Shoulder periods (c/kWh) | Off-Peak periods ( (c/kWh) | Peak periods ( (c/kWh) | Solar Soak period ( (c/kWh) | |||
Ausgrid* | NSW | - | 27.56 | 63.72 | - | 1.76 |
Endeavour Energy | NSW | - | 37.53 | 48.75 | 14.19 | 1.85 |
Essential Energy | NSW | - | 27.60 | 45.57 | - | 2.72 |
Energex | Southeast QLD | 26.41 | 8.1101 | 48.90 | - | 1.78 |
SA Power Networks | SA | - | 35.17 | 58.84 | 19.66 | 1.80 |
Source: DMO 2026–27 final determination, May 2026. *Ausgrid does not have peak periods in April, May, September and October. | ||||||
What else should I know about the DMO?
Starting July 1st, the AER has also confirmed the following set of reforms and changes:
- Price increases are limited to one change a year.
- Hardship customers are to be automatically moved onto a retailer’s cheapest plan (or best offer).
- Hardship customers cannot be charged retail fees (except network charges).
- Customers on plans with short-term discounts cannot be moved onto a plan higher than the default.
How does the DMO impact your power bill?
The figures below represent the number of customers on a flat rate standing offer in each state under the AER’s jurisdiction.
Percentage of customers on a flat rate standing offer plan | |
|---|---|
NSW | 7% |
South East QLD | 10% |
SA | 8% |
Source: AER, May 2026 | |
Once July 1st passes, these customers could end up saving up to $155 for that financial year. However, standing offers still generally represent the maximum price paid to keep the lights on.
The remaining customers not on a standing offer are likely to be on a market offer, which are plans set by retailers with competitive rates and features.
Retailers rely on the reference price in each state and network as a guide for setting the rates on their market offers. If the DMO drops, retailers will likely decrease their market offer rates across the board, passing on those savings to customers.
With the new ToU reference price, the same trend will likely apply to ToU market offers.
Remember that it may take a few working days for all price adjustments to take effect. We highly encourage shopping around after July 1st to ensure you’re on the cheapest possible plan at your address.
What should I do now?
There’s still at least four weeks until July, so it’s important to set a calendar reminder for July 1st, but hold off on switching in the days to follow.
If you aren’t comparing energy plans proactively, you may unknowingly be on a standing offer. You can verify this by checking your recent energy bill.
You can start saving money on your next power bill by switching earlier to a cheaper energy plan:
Savings from switching from current DMO to lowest-priced plan | ||
Sydney | +$507 | 26% |
Brisbane | +$533 | 25% |
Adelaide | +$596 | 26% |
Source: Canstar.com.au - Potential savings are indicative estimates based on single rate electricity plans on Canstar using the reference usage set by the AER. Costs based on the estimated lowest possible price a customer would be charged in the next 12 months, assuming all conditional discounts are met. Assumes prices for lowest rate plans change inline with new default prices in dollar terms. | ||
If you’re not interested in switching plans between retailers, you can start by switching to your current retailer’s best offer — all you have to do is contact your retailer or switch online through their portal.
