Proposed timeline to determine the Default Market Offer prices applying for 2024–25

On 5 October 2023 we released the issues paper for the 2024–25 DMO period (DMO 6).

The issues paper is the first step in the process in setting the upcoming DMO prices. As part of the DMO 6 issues paper consultation process we are considering several refinements to improve the methodology we will use to set the DMO price. The AER is particularly seeking views on the following aspects:

• whether and how to change our approach to the customer load profile which is used to model wholesale costs as the uptake of advanced meters and installation of solar PV systems continues 
• whether we should continue collecting confidential hedge contract data from all retailers and generators to assess the wholesale costs of retailers. 
• whether a different wholesale forecasting method is required for South Australia given the currently limited (and decreasing) hedge contract liquidity levels in South Australia
• whether the approach to retail allowances remains appropriate  
• other relatively minor issues, including whether to change our: 
  • methodology for calculating bad and doubtful debts. 
  • retail operating cost calculations for small businesses.
     

Submissions from interested stakeholders were invited by 3 November 2023, 22 submissions were received.

As part of the consultation process for its DMO 6 price determination the AER hosted an online public forum on Friday, 27 October 2023.

The online public forum provided stakeholders with an opportunity to hear from AER staff on key matters for consideration in the recently released issues paper. Origin Energy and Business NSW also presented their positions and understanding of the issues paper. The presentation slides are provided below.