The Default market offer (DMO) came into effect on 1 July 2019. The DMO is a maximum price that retailers can charge electricity customers on default contracts known as standing offer contracts. A customer may be on a standing offer for several reasons – such as, if they have never switched to a retailer’s market offer, or have defaulted to a standing offer at the end of their market offer benefit period.
The Competition and Consumer (Industry Code – Electricity Retail) Regulations 2019 sets out the legislative framework for the DMO.
The DMO applies to small business and residential customers in areas where there is no other retail price regulation (South Australia, New South Wales and south-east Queensland). The DMO price for each area also acts as a ‘reference price’ for residential and small business offers in that area. When advertising or promoting offer pricing, retailers must show the price of their offer in comparison to the DMO/reference price. This helps customers more simply compare the price of different offers.
The AER’s role is to determine the DMO price each year. This is the sixth time we will determine DMO price. As such we refer to the DMO for 2024–25 as ‘DMO 6’.
On 5 October 2023 we released the issues paper for DMO 6, 19 submissions were received.