The Default Market Offer is a government-regulated maximum price that electricity retailers can charge customers on standing offer contracts in certain regions of Australia.
It was introduced in July 2019 to address concerns that customers who did not actively shop around for electricity were paying significantly more than others on market offers.
The Default Market Offer applies in the following regions:
📍 New South Wales (NSW)
📍 South Australia (SA)
📍 South-East Queensland (SE QLD)
Other states and territories operate under different regulatory arrangements. For example, Victoria has its own regulated benchmark known as the Victorian Default Offer (VDO).
The Default Market Offer is reviewed and set each year by the Australian Energy Regulator (AER).
As part of its annual determination, the regulator estimates the efficient cost of supplying electricity to a typical customer. This assessment takes into account:
⚡ Wholesale electricity costs
💰 Network and infrastructure charges
🍃 Environmental scheme costs
📈 Retail operating expenses and a reasonable margin
The updated Default Market Offer prices usually take effect from 1 July each year.
The Default Market Offer applies only to customers on standing offer electricity contracts.
While the Default Market Offer directly caps prices only for standing offers, changes to the DMO can also have indirect effects across the broader electricity market.
When the Default Market Offer is updated:
1️⃣ Retailers may review their market offer pricing and plan structures
2️⃣ Existing market offers may change, and new offers may be introduced
3️⃣ Some electricity plans may be withdrawn or replaced over time
As a result, even customers on market offers may notice changes to available plans or pricing following annual updates to the Default Market Offer.
Understanding how the Default Market Offer works can therefore be useful not only for customers on standing offers, but also for those reviewing or comparing market offers.
Understanding the Default Market Offer can help customers:
✅ Check whether they are on a standing offer
✅ Use the reference price to compare electricity plans
✅ Better understand why electricity prices change year to year
✅ Avoid remaining on uncompetitive plans by default
The Default Market Offer provides a safety net, but it is not always the most cost-effective option.
This website is operated by Zembl, an independent energy services provider. Zembl is not a regulator and is not affiliated with the Australian Energy Regulator. The purpose of this site is to provide general, educational information about how regulated electricity reference prices work. All content is written in original language based on publicly available information.
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The Default Market Offer (DMO) is a regulated electricity pricing benchmark set by the Australian Energy Regulator (AER). It acts as a maximum price (cap) for electricity standing offer contracts in certain regions and is also used as a reference price to compare market offers.
No. The DMO is designed as a benchmark and safety net for customers on standing offers, not as the cheapest available plan. Market offers can be priced above or below the DMO reference price.
The DMO applies to residential and small business customers who are on standing offer electricity contracts in applicable regions, but changes to the DMO can also have a knock-on effect across the wider market—retailers may adjust market offer pricing, discounts, and plan structures after the DMO is updated, meaning available market plans and prices can change even for customers not on standing offers.
The DMO applies in:
Other states and territories have different arrangements (for example, Victoria uses the Victorian Default Offer).
No. Victoria has its own regulated benchmark called the Victorian Default Offer (VDO), which serves a similar purpose in that state.
A standing offer is a standard electricity contract with terms and prices set by the retailer, and its price is capped by the DMO in applicable regions. A market offer is a retailer’s competitively priced plan that may include discounts, incentives, or fixed-term pricing, and can be above or below the DMO reference price.
A quick clue is whether your plan is described as a “standing offer” on your bill or retailer correspondence. If you’re unsure, your retailer can confirm your plan type. Understanding the DMO helps because it only caps prices for standing offers.
Retailers must show how their market offers compare to the DMO reference price (for example, “10% below the reference price”). This helps customers compare plans more easily.
Updated DMO prices usually take effect from 1 July each year, following an AER review process that typically includes a draft determination released around March–April and a final determination published around May, ahead of the 1 July start date.
Indirectly, it can. While the DMO caps standing offer prices, annual DMO updates can influence how retailers price and structure market offers. Some market offers may change, be withdrawn, or be replaced after the DMO is updated.
The DMO was introduced in July 2019 to address concerns that customers who didn’t actively shop around were paying significantly more than others, and to improve transparency and comparability across electricity plans.
The 2025–26 DMO increases were driven primarily by higher wholesale electricity costs, increased network charges, and rising retail operating costs.
From 1 July 2025, DMO prices increased across all applicable regions. The size of the increase varies by region and network area, and typical annual costs differ for residential households and small businesses.
No. This website is an independent informational resource operated by Zembl and is not affiliated with the AER, the Essential Services Commission (ESC), or any government agency.
No. The content is general information only and does not constitute legal, financial, or energy advice.
If offered on the site, small businesses can optionally request a bill comparison from Zembl to help understand how their current bill compares with available market offers. This is separate from the informational content and not affiliated with any regulator.