KEY POINTS
- The Default Market Offer (DMO) is a price cap for all standing and market offers in New South Wales, South East Queensland and South Australia.
- The DMO prevents customers from paying too much for electricity when their existing plan expires and acts as a point of reference.
- The DMO isn’t designed to be the most competitive — actively comparing electricity plans ensures that you’re getting a good deal.
First introduced by energy regulators as a response to the Australian Competition and Consumer Commission’s (ACCC) inquiry into electricity prices, the ‘Default Market Offer (DMO) serves as a price cap for electricity on standing and market offer contracts in New South Wales, South East Queensland and South Australia
With that in mind, Canstar Blue has created this guide to explain how the DMO works and what the current DMO price is in each deregulated state.
On this page:
- What is the ‘Default Market Offer’?
- Default Market Offer and Victorian Default Offer prices 2025-26
- Why was the Default Market Offer introduced?
- How does the Default Market Offer work?
- Comparing electricity plans cheaper than the Default Market Offer
- Am I affected by the Default Market Offer?
- How do I find out if I’m on the Default Market Offer?
- Are there other ways to save on electricity?
What is the Default Market Offer?
The Default Market Offer (DMO) is an electricity tariff set by the Australian Energy Regulator (AER), which serves as a price cap on all standing and market offers in New South Wales (NSW), South East Queensland (QLD) and South Australia (SA).
Since its introduction, electricity retailers can still technically charge more than the DMO on their market offers, but many prefer not to. The DMO acts as a ‘reference price’ for standing and market offers to be compared to.
It’s important to understand that the DMO is not designed to be a competitive energy price, and the best deals may still be hundreds of dollars a year cheaper.
The AER will release a draft determination each year in March, then release its final decision in May for prices to come into effect July 1.
Similarly, the Essential Services Commission releases its Victorian Default Offer (VDO) annually for the five electricity distribution zones in Victoria.
Default Market Offer and Victorian Default Offer prices 2025-26
The final decision for the DMO 2025-26 was released on 26 May 2025. The AER calculated this with the forecast of wholesale electricity, network and retail costs for the financial year 2025-26. The table below shows the final determination prices across distribution zones in NSW, QLD, SA and VIC:
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| Distribution network | 2025-26 DMO prices | |
|---|---|---|
| NSW | Ausgrid | $1,965 |
| Endeavour Energy | $2,411 | |
| Essential Energy | $2,741 | |
| QLD | Energex | $2,143 |
| SA | SA Power Networks | $2,301 |
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| Distribution network | 2025-26 VDO prices | |
|---|---|---|
| VIC | AusNet | $1,908 |
| CitiPower | $1,546 | |
| Jemena | $1,638 | |
| Powercor | $1,703 | |
| United Energy | $1,579 |
Source: AER and ESC. Prices are estimates for a residential property without a controlled load. Electricity usage is based on an average household as determined by the regulator and varies across the networks. Average bill for domestic VIC customers 4000kWhr/yr. Based on domestic flat tariffs.
Why was the Default Market Offer introduced?
Energy customers have a choice between two types of electricity contracts – standing offers and market offers. Energy retailers set market offers and often include conditional discounts, guaranteed discounts and rewards programs.
Standing offers are basic electricity deals with no discounts. Standing offers are generally more expensive than market offers and are only intended as the fallback option once a customer’s original electricity deal expires.
The ACCC’s Retail Electricity Price Inquiry report found that the electricity retail market was too confusing for consumers to shop for a better deal. The report also identified that Australian households were being left on standing offers, consequently paying much more for electricity.
The DMO is a safety net price for electricity consumers who don’t engage in the energy market. Electricity customers not signed up to market offers may still receive a ‘fair’ deal on electricity.
It also helps to ensure that loyal customers who stick with their electricity retailer don’t experience unanticipated bill shock from expensive standing offers once their original energy deal expires.
How does the Default Market Offer work?
The DMO, or reference price, is set by the AER. The AER legally requires electricity retailers to advertise clear and concise conditions of each plan on their websites, referring to the DMO as a point of reference. It is based on specific electricity usage and supply charges in different areas, meaning the reference price will vary between states and distribution networks.
Providers must clearly show how their plan’s prices compare to the reference price set for whatever state the plan is designed for. Generally, price differences are reflected as a percentage (e.g. this offer is 15% less than the reference price).
The following factors influence how the AER sets the reference price:
- Wholesale electricity costs
- Network costs
- Environment costs
- Retail costs
- Retail allowance.
The following example is taken from the AGL website:
Comparing electricity plans cheaper than the Default Market Offer
To help find a better price, the tables below feature some of the cheapest prices in Canstar Blue’s database compared to the DMO.
Here are some of the cheapest published deals from the retailers on our database that include a link to the retailer’s website for further details. These are products from referral partners†. These costs are based on the Ausgrid network in Sydney but prices may vary depending on your circumstances. This comparison assumes general energy usage of 3900kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area and to see other products in our database that may be available. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.
Here are some of the cheapest published deals from the retailers on our database that include a link to the retailer’s website for further details. These are products from referral partners†. These costs are based on the Energex network in Brisbane but prices may vary depending on your circumstances. This comparison assumes general energy usage of 4600kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area and to see other products in our database that may be available. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.
Here are some of the cheapest published deals from the retailers on our database that include a link to the retailer’s website for further details. These are products from referral partners†. These costs are based on the SA Power network in Adelaide but prices may vary depending on your circumstances. This comparison assumes general energy usage of 4000kWh/year for a residential customer on a single rate tariff. Please use our comparison tool for a specific comparison in your area and to see other products in our database that may be available. Our database may not cover all deals in your area. As always, check all details of any plan directly with the retailer before making a purchase decision.
Am I affected by the Default Market Offer?
The DMO only affects customers in New South Wales, South East Queensland and South Australia. The DMO does not affect:
- Regulated areas of Southeast Queensland, South Australia and New South Wales
- Gas plans in Australia
- Embedded networks
- Northern Territory (NT)
- Tasmania (TAS)
- Western Australia (WA)
- Australian Capital Territory (ACT)
- Victoria (VIC)
Customers in Victoria have the VDO, while the ACT follows a similar ‘reference price’ structure in its energy market.
The DMO also applies to customers on the following tariffs:
- Single rate tariffs: Electricity consumption per kWh stays the same regardless of the time of day.
- Time of use tariffs: Electricity consumption per kWh is priced differently depending on the time of day.
- Controlled load tariffs: Energy-hungry appliances (e.g. pool pumps) are metered separately, drawing energy during off-peak hours for usage during peak hours.
- Solar feed-in tariffs (FiT): a credit paid to customers for exporting unused solar energy back to the grid.
How do I find out if I’m on the Default Market Offer?
If you haven’t moved home or compared electricity plans in a while, chances are you could automatically be on a standing offer plan.
To verify this, check your latest electricity bill. The contract type should be listed on your bill as a ‘standard offer’ or a specific market offer plan.
If you’re currently on the DMO, the AER legally requires all retailers to inform their customers of the following on their energy bills:
- If they could save more by switching to the retailer’s best market offer.
- Instruct customers on how much they could save and how to switch over to the best market offer..
Are there other ways to save on electricity?
The DMO offers some protection for electricity customers, however, there are other ways to save on electricity.
Consider getting a solar system
Installing a rooftop solar system can help ease rising electricity costs.
A solar system can help by:
- Capturing solar energy for immediate use around the house. You will need a net meter and smart meter installed.
- Exporting the excess to the grid in exchange for a bill credit through a solar FIT.
- If you opt for a solar battery, you can reduce your reliance on grid power and access electricity during electricity outages.
How much you can save will depend on:
- Solar system size
- The number of solar panels installed
- The angle and direction of the solar panels
- The payback period for the entire solar system
- The type of solar panel, solar inverter or battery purchased.
Make your home more energy efficient
Transforming your home into an energy-efficient space helps you reduce your energy consumption and carbon footprint through passive features such as natural ventilation and improved shading.
Monitor your energy consumption
Actively monitor your energy consumption to understand when and what consumes the most electricity in your home.
If you have a smart meter installed, you can download your retailer’s official app to track your running consumption or self-install an electricity usage monitor for real-time tracking.
Comparing electricity plans
The price difference between the cheapest and most expensive electricity deals can be significant, meaning you could be paying too much for power if you haven’t compared retailers and plans in the last 12 months.
Shopping around and comparing electricity plans remains the best way to ensure you’re getting the best value for money.
You can begin your comparison journey by entering your details in the Canstar Blue tool below and filtering the results by price. This will show you the cheapest plans in your area, and you will also see the price of each plan in comparison to the reference price.
Original reporting by Jared Mullane
Image Source: biDaala studio/Shutterstock.com
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