Here are the key differences:
| Response | |
|---|---|
| No | 68.56% |
| Yes | 31.44% |
There are two different types of electricity plans in Australia: standing offers and market offers. It only directly affects standing offer customers.
The energy regulator has set a price cap for standing offers, meaning retailers can't charge customers more than the reference price for standing offers.
This price cap doesn't apply to customers on market offers. However, market offers often include discounts, special prices and cheaper rates than the DMO.
Energy retailers in New South Wales, South East Queensland and South Australia used to be able to advertise discounts that were calculated from different base rates. This made it challenging to compare discounts from different retailers.
With the new reference price, electricity retailers must advertise pricing and discounts in relation to the reference price, leading to more transparent pricing and easier comparison. If two retailers offer 20% discounts, you know the discounts are equivalent because they are calculated from the same base rate.
Depending on where you live, an average household on a standing offer could save between $129 and $181 per year (with the reference price), and a small business could save up to $896 per year.
If you're on a market offer, the DMO doesn't directly apply to you. However, retailers show the difference between their plans and the reference price. For example:
| Plan 1 | Plan 2 | Plan 3 |
|---|---|---|
| 5% less than reference price | 10% less than reference price | 15% less than reference price |
Keep in mind, while the reference price helps you compare plans and providers, you might end up paying more or less than the advertised rate depending on your usage.
How to switch energy providers
If you're comparing energy you may have come also across the following terms: Standing offers and Market offers. Our infographic below helps explain the difference.
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Picture: GettyImages
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Not necessarily. The DMO only applies to standing offers. Depending on where you live and your energy use, a market offer could be much cheaper than the DMO. Make sure to shop around and compare a range of providers to see if there is a cheaper option.
If you're not sure what type of offer you're on, you can check your latest electricity bill or contact your energy retailer and ask.
Typically, customers who have had the same retailer for years and haven't changed their plan during this time are likely on standing offers.
It depends on the type of plan you're on. The reference price changed the way retailers are required to advertise discounts, but the specific discounts available to you depend on the plan and the retailer.
To find out what discounts apply to you, contact your retailer directly.
The Victorian government introduced a price cap for the state on 1 July 2019, also known as the Victorian Default Offer (VDO). The VDO works similarly to the DMO as a maximum price for standing offers.
The electricity markets in Tasmania, Western Australia, Northern Territory, regional Queensland and the Australian Capital Territory are regulated by state governments and other authorities.
No, the reference price only applies to electricity plans .
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