Australian Energy Regulator orders cut to default market offer electricity bills

Consumers daunted by trying to navigate the electricity market who have stuck loyally with their retailer will see bills cut from July.

HOUSEHOLDS which have not shopped around for a cheaper electricity deal will get an average $109-a-year cut to their bills from July 1.

The cap on prices will be reduced on the first day of the new financial year by order of the Australian Energy Regulator.

Its so-called default market offer, announced today, also acts as a reference point against which retailers must compare their contracts.

“Customers on standing offers were being charged some of the highest prices in the market,” regulator chair Clare Savage said.

“The default market offer is designed to protect the 10 per cent of residential and 20 per cent of small-business customers on standing offers by setting a cap on what energy retailers can charge them.

“It is not meant to give these customers the best possible energy price.

“It simply means their energy provider can’t charge them an unjustifiably high price because they haven’t negotiated a better deal.”

For SA households, the average annual bill will fall from $1941 to $1832.

Small businesses in SA will see an $815 cut on the average bill to $8305.

Energy and Emissions Reduction Minister Angus Taylor welcomed the announcement.

“Hundreds of thousands of hardworking Australian households and businesses have already benefited from lower electricity bills since the default market offer price cap was introduced,” he said.

“This update will give welcome relief to loyal energy customers, particularly during the COVID-19 pandemic.

“Loyal customers who find it confusing or hard to navigate energy pricing and discounts, can now be assured they will no longer be taken advantage of by their retailer.”