Video summary: This video explains the default market offer (DMO) and why it’s an important consumer protection mechanism.
Published: 28 February 2023
(Background soft instrumental music plays for the duration of the video. The video is an animation with text and image icons. The text is a summary of frequently asked questions explaining the default market offer, known as DMO for short.)
The following frequently asked questions appear in the video.
What is the Default Market Offer (DMO) price?
It is the maximum price an electricity company can charge customers on standard retail plans. It protects consumers from unjustifiably high prices.
How does the DMO provide a reference point for customers?
Electricity companies must compare their offers to the DMO price in their advertising so you can see how good their deal is.
Who does it apply to?
Residential and business electricity consumers in New South Wales, South Australia and south-east Queensland. Most consumers in these areas have shopped around for offers with different prices. Around 10% of households and around 18% of small businesses are on plans where the DMO price cap applies directly.
When does the DMO come into effect?
A new DMO price comes into effect on 1 July each year and retailers adjust their offers.
How is the DMO determined?
A number of factors influence the DMO price such as the cost retailers pay generators and to have it transported to Australia homes and businesses along poles and wires.
The cost to serve customers and the cost of complying with Government environmental schemes are also taken into account. When input costs such as wholesale, network, environment and retail costs are higher the DMO may increase.
Is the DMO price the best offer?
No. There may be better deals to be had in your area.
How can I find out if there is a better offer?
- Find out what plan you are on
- Contact your electricity company and ask if they have a better offer
- Compare energy plans from different electricity companies by visiting www.energymadeeasy.gov.au