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In a promising turn of events for Australian households, the electricity regulator has proposed safety net prices that could save families up to $200 in the upcoming financial year. These adjustments, known as default market offers, are part of the annual update that aligns with the cost of providing electricity to homes and businesses.
While the benchmark prices vary across different regions, residential customers in New South Wales, South Australia, and southeast Queensland can look forward to reductions in their electricity bills, ranging from 1.3% to as much as 10.1% compared to last year.
Energy Minister Chris Bowen expressed optimism over the draft proposal, noting it as a sign of “good progress” in the effort to manage electricity prices, which have surged significantly in recent years. This development comes as a relief to many consumers who have been grappling with rising energy costs.
When questioned about the potential impact of the ongoing Middle Eastern conflict on Australia’s energy prices—particularly after reports of Israel striking a major gas field in Iran—Bowen indicated that there has been no evident effect on local pricing thus far.
Asked if Australian energy prices had been impacted by the war in the Middle East, with news overnight Israel struck a major gas field in Iran, Bowen said there hadn’t been a clear impact.
“Obviously we’ve been monitoring the gas and coal markets very closely. The good news is gas prices in Australia have at this point not been impacted much.”
He said the government would continue to monitor as this could change.
The average household in NSW could pay $58-$226 less than the year before, and bills could be roughly $216 lower in southeast Queensland across the 12 months.
A more modest $31 fall can be expected for South Australian households.
Small businesses are in line for price decreases between 7.6 per cent and 21.2 per cent, depending on area.
Wholesale electricity prices, pole and wire maintenance and construction, retailing expenses, and compliance with government environment schemes all feed into the Australian Energy Regulator’s annual decision for the three states.
Regulator chair Clare Savage said lower default market offers reflected easing electricity costs, particularly wholesale energy.
Electricity contract prices had fallen, spot prices had become less volatile, and wind and battery generation had picked up, she said.
Lower retail operating costs and a more efficient price framework under government reforms were also highlighted.
“This draft decision points to the potential for some welcome relief for households and small businesses after several years of rising energy costs following Russia’s invasion of Ukraine,” Savage said.
Only the 10 per cent of households and 18 per cent of small businesses that fail to shop around end up on standard offers from their retailers and the regulator encourages customers to pursue more competitive offers.
Customers on the default offer could save up to 12 per cent on energy bills by calling up and switching to a mid-market offer.
Default market offers also create a baseline to easily compare other deals with.
The regulator is expected to finalise the offer in May.
Victorian benchmark prices were proposed by a separate state-based regulator last week.
The Essential Services Commission flagged a 3 per cent average fall, or $46, in annual bills across the five zones compared to 2025/26.
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