Default Market Offer 2026–27: What the New Electricity Prices Mean for You

The DMO is a regulated "safety net" maximum price set annually by the AER for residential and small business customers in NSW, South East Queensland and South Australia who are on a standing offer — meaning they haven't actively negotiated a market contract with their retailer. It doesn't apply in Victoria, which runs its own separate default offer (the Victorian Default Offer), or in states with different retail regulation arrangements. If you're on a market offer with negotiated discounts, the DMO doesn't directly set your price, but it's still a useful reference point because retailers commonly price their market offers as a discount against the DMO.

The AER's determination sets out different changes depending on your network area and tariff type. On a flat rate DMO:

For customers on a time-of-use DMO, the changes are different again:

Small business customers see larger movements in most regions — for example, NSW small businesses on a flat rate DMO see decreases of −9.0% to −11.3% (roughly $432 to $705), while South East Queensland small businesses see a −10.4% decrease (about $445).

The overall pattern for 2026–27 is that most residential customers in NSW and South East Queensland are getting a price decrease, while South Australian residential customers on a flat rate see a small increase, though those on time-of-use tariffs see a small decrease. This is a genuine reversal from the 2025–26 determination, when NSW households saw increases of up to $228 (around +9.1%) and South East Queensland households saw increases of around $77.

The DMO is recalculated each year to reflect changes in the underlying costs that make up a retail electricity bill — wholesale energy costs, network costs, environmental scheme costs, and retail operating costs. The Australian Energy Market Commission's own price trends analysis, released in December 2025, projects average wholesale-driven residential prices across the National Electricity Market to fall by roughly 5% over the next five years, which is broadly consistent with the direction of this year's DMO decision in NSW and Queensland. South Australia's smaller and mixed movement reflects that its cost drivers, particularly network costs, haven't moved in the same direction.

Being on the DMO isn't inherently bad — it's a regulated, capped price, which means your retailer can't charge you more than that amount on a standing offer. But it is very rarely the cheapest price available. Retailers routinely offer market contracts with discounts against the DMO, particularly for customers who pay by direct debit or use online billing. If you've never actively chosen a plan with your retailer, there's a reasonable chance you're paying the DMO rate, and it's worth asking your retailer directly what discount they can offer against it, or comparing plans through your state's official comparison service.

Once the new DMO applies, your bill should show:

• Which network you're in (this determines which DMO rate applies to you)
• Whether you're being billed under a flat rate or time-of-use structure
• Whether you're on a standing offer (DMO-priced) or a market offer

If your bill doesn't clearly show whether you're on a standing or market offer, contact your retailer and ask directly — this is basic information they're required to disclose, and it's the first thing to check before deciding whether switching plans or retailers makes sense for your situation.

The DMO determination only covers NSW, South East Queensland and South Australia. Victoria has its own equivalent, the Victorian Default Offer, set separately by the Essential Services Commission. Western Australia, Tasmania, the Northern Territory and the ACT have different retail market structures again, generally with more limited retail competition, so a "default offer" concept doesn't apply in the same way. If you're outside NSW, South East Queensland or South Australia, the DMO figures above don't apply directly to your bill, and you should check with your local regulator for the equivalent reference price.

Does the DMO change automatically apply to my bill, or do I need to do anything? If you're on a standing offer, the change applies automatically from 1 July 2026 — you don't need to contact your retailer. If you're on a market offer, the DMO change may still indirectly affect your price if your discount is calculated against the DMO, so your bill amount could change even though you didn't ask for anything.

Is the DMO the cheapest electricity price available? No. It is a regulated maximum, not a competitive minimum. Market offers with retailer discounts are usually cheaper than the DMO for customers who pay on time and use online billing.

Why did South Australia's price go up while NSW and Queensland went down? The research available attributes this to differing cost drivers between networks — South Australia's flat rate DMO reflects an increase largely tied to network costs, while the broader downward trend in NSW and South East Queensland is more consistent with falling wholesale price projections. For the precise cost breakdown behind South Australia's figure, the AER's published determination is the authoritative source.