THE DEFAULT MARKET OFFER (DMO) ANNOUNCED WITH REBATES IN SIGHT
Default Market Offer 2024-2025
It’s that time of year again, and we’re gearing up for changes in electricity pricing. The Australian Energy Regulator (AER) has just released its final determination for the 2024–25 Default Market Offer (DMO 6). The DMO caps the price retailers can charge household and small business customers on standard retail plans in South Australia, New South Wales, and Southeast Queensland.
Effective from July 1st, 2024, QLD residential prices are up approximately 4% and small business prices are up 1%. This news comes at the same time as the Queensland and Australian governments have announced Cost of Living Rebates for every household’s electricity bill that will help offset the increased prices. Alternately, NSW & SA have had decreases made to their DMO prices.
Understanding the Default Market Offer
The Default Market Offer is a government-regulated electricity price cap intended to protect consumers from excessively high charges. It provides a safety net by setting a maximum price that energy retailers can charge customers who are on default contracts, typically those who have not or cannot shop around for better deals. The DMO also acts as a reference point, helping consumers compare various market offers and make informed decisions about their electricity plans.
Cost Components
The breakdown of the cost components contributing to the price change includes:
– Wholesale Costs: Increased demand and generation costs.
– Network Costs: Upgrades and maintenance of the distribution network.
– Environmental Costs: Compliance with renewable energy targets and policies.
– Retail Costs and Margins: Administrative and operational costs for retailers.
Implications for Southeast Queensland
Consumers in Southeast Queensland are encouraged by the AER to review their current electricity plans in light of the new DMO and those in Embedded Networks may consider moving in line with the increase.
While the default offer provides a safeguard, market offers from various retailers may present opportunities for savings. Hum Energy has helped thousands of Queenslanders in Strata Communities save on energy bills through Embedded Networks, Multi-Site agreements, and Renewables such as Solar.
Article Contributed by Ben Humphreys, Managing Director, HumEnergy
Leave a Reply
Will this Default rebate be available to the rest of Queensland at some tiime?