08/03/2023
🏠💼 Households and Businesses Prepare for Energy Regulator’s Draft Decision
It’s the news that many households and businesses have been dreading – the Australian Energy Regulator (AER) is set to release its draft decision on Default Market Offer (DMO) prices very soon, and it’s not likely to be good news. 😔
DMO prices represent the maximum amount that electricity retailers can charge customers on a standing offer, which includes those who haven’t signed up for a market offer. Since 2019, the AER has set DMO prices for small business and residential customers in South Australia, New South Wales, and southeast Queensland. When DMO prices go up, market offers usually follow suit.
Last November, the AER released an issues paper for the 2023/24 financial year decision. Now, we’re waiting for the draft determination, which was set to be published in February 2023. After some further consultation, the final decision will be released in May, and “DMO 5” will come into effect on July 1. 📅
One thing is for certain – DMO pricing won’t go down. According to the ABC, the draft decision will propose increases of at least 20 percent. This news comes after further EnergyAustralia price hikes came into effect in NSW, ACT, and SA at the beginning of this month. 💸
For those on Time-of-Use (ToU) arrangements, electricity rates are far cheaper during the shoulder period thanks to the impact of home solar power pushing down wholesale prices during the 10 am to 3 pm period. However, the new peak rates are much higher, so many households and businesses are considering alternative energy options such as solar panels, home batteries, and electric vehicles. ☀️🔋🚗
In the past, our household was somewhat sheltered from recent electricity price volatility under an EnergyAustralia plan that was costing us, after discounts, 36c/kWh flat rate and a daily supply charge below a dollar a day. But now, it’s time to start thinking more about a better electricity plan. 💡
Overall, households and businesses are bracing themselves for the impact of the AER’s draft decision, and many are looking for alternative energy options to reduce their energy bills. Keep an eye out for the draft determination in the coming weeks and start thinking about ways to reduce your energy costs. 💪