The Victorian Default Offer is increasing, and so are the electricity prices customers pay. Here’s why:

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  • August 9, 2021

It’s no secret that customers in Australia find their electricity service – and particularly electricity pricing confusing. The most common questions that all energy providers hear are,

“Am I getting a good deal?” and,

“How do I know what I’m paying is being regulated?”

In Victoria, the Essential Services Commission (ESCV) implemented the Victorian Default Offer (VDO) in 2019 to answer these very questions and provide electricity customers with more clarity and protection.


So, what is the VDO?

The VDO is a simple and trusted electricity price that is set by the ESCV, not energy companies. The prices you receive from your energy provider are set in reference to the VDO, meaning they will be either equal to the VDO or lower than the VDO.

This gives customers peace of mind that the pricing they receive is regulated, provides a guide to review electricity plans or offers, and provides additional customer protections.


Why are electricity prices going up as of the 1st September 2021?

As part of setting the VDO, the ESCV considers any changes within the energy market that influence the costs associated with retailers supplying their customers with their electricity service.

For the 1st September 2021 VDO, the ESCV has reported the VDO will be increasing slightly to account for an increase in network charges.

The network charges that make up an electricity bill account for a third of the overall prices you pay and go towards the maintenance and upgrades of the poles and wires by your area’s distributor (either Ausnet, Citipower, Jemena, Powercor or United Energy).

The ESCV has said that while there will be an increase, it is small, with households expecting to pay about $4 more per month, depending on their usage.

If you would like more information about the 1st September VDO changes, please see the following from the ESCV website.