800,000 electricity customers in South Australia, New South Wales and South-East Queensland will get a better energy deal as the Morrison Government continues to drive down power prices.
Effective from 1 July 2019, the Morrison Government has abolished the loyalty tax and the misleading use of discounts to attract customers.
The Australian Energy Regulator (AER) has today released the final determination for the Default Market Offer (DMO) which will cap prices for standing offers, acting as a price safety net for those who find pricing and discounts confusing, or who simply don’t have time to negotiate.
The DMO figure will also act as a reference price for all other small business and residential customers, requiring energy retailers to advertise their standing and market offers against a common price benchmark.
Households changing to default market offers from standing offer tariffs could save up to $481 in South Australia, $663 in NSW and $662 in south-east Queensland.
Small businesses on standing offer tariffs could save up to $896 in South Australia, $457 in south-east Queensland and $878 in NSW.
The DMO and reference price were recommendations of the Australian Competition and Consumer Commission (ACCC), and will prevent energy companies from slugging their customers with excessive standing offer rates and benefitting from the confusion created by misleading discounts.
The DMO will not apply in Victoria, after the Victorian Government followed the Morrison Government’s lead and implemented their own default market offer.
For too long, the energy companies have been taking advantage of loyal Australian families and small businesses who have been paying the highest electricity prices on the market.
The Australian Energy Market Commission found a family on a standing offer in Adelaide could be paying as much as $832 more per year for their electricity than a neighbour, simply because they’ve been loyal or haven’t shopped around. That is simply unfair.
The ACCC will also be watching retailers to ensure they provide their customers a fair deal and not increase better offers to offset the loss of their excessive margins from standing offer customers.
The savings delivered by the DMO builds on the price cuts that the Morrison Government secured from 1 January 2019 of up to 15 per cent for families and small businesses.
The Morrison Government actions to bring down electricity prices are in stark contrast to Labor’s policies. Electricity prices doubled when Labor was last in government. Independent modelling has shown that Labor’s 45 per cent emissions target will push up wholesale electricity prices by 58 per cent by 2030.
Labor simply can’t be trusted to address cost of living pressures for families and lower costs for small businesses.