Overview

The Essential Services Commission sought your views on how the amendment of the 2021 price determination of the Victorian default offer should take into account changes to network tariffs, which will apply from 1 July 2021.

We published our amendment draft decision on 25 June and sought feedback on our proposal to increase the Victorian Default Offer to reflect upcoming changes to national electricity network costs until 2 July 2021.

Our role in setting the Victorian default offer

The Essential Services Commission is responsible for setting Victorian default offer prices. The default offers are designed to be simple, trusted and reasonably priced electricity options to safeguard customers unable or unwilling to engage in the market. On 27 November 2020, we made a final decision and price determination on Victorian default offer prices to apply from 1 January 2021 for customers on electricity standing offers. For information about our proposed approach for setting the 2022 Victorian default offer prices, please visit our 2022 Victorian default offer Engage Victoria page.

Amendment to 2021 Victorian Default Offer

Final decision

We released our final decision that would see changes in network costs reflected in the Victorian Default Offer from 1 September 2021. We have also released the amended Victorian Default Offer 2021 price determination.

The variation will take effect from 1 September 2021.

The amended default offer price determination reflects changes in network costs

Under the Victorian Default Offer 2021 price determination, we used tariffs approved by the Australian Energy Regulator for the period 1 January to 30 June 2021. The approved network tariffs for the second half of the year were not available at that time.

On 15 June 2021, the Australian Energy Regulator approved the Victorian distribution network businesses' network prices applying from 1 July 2021. We amended the current Victorian Default Offer price determination to reflect these new network prices from 1 September 2021.

Households on the default offer will pay around $4 a month more, on average, as a result of the changes in network costs.

The amended price determination applies to the tariffs licensed retailers (who sell electricity in Victoria) can charge residential and small business customers during the regulatory period 1 September–31 December 2021. The Victorian Default Offer also applies as a maximum price for most residential and small business customers in embedded networks.

2021 Victorian Default Offer

Engaging with stakeholders during the coronavirus pandemic meant we adapted our approach to the needs of stakeholders. We made it easier for stakeholders to have their say in this environment. Activities we undertook included:

  • asking key questions about our approach in our consultation paper
  • promoting discussion in our online public forums where we heard from consumers and businesses
  • answering questions that came to us through our Engage Victoria virtual public forum and
  • requesting and receiving submissions on our consultation paper and our draft decision.

Feedback on our draft decision led to changes in our final decision. Further detail on our responses to submissions can be found in our final decision document and our public engagement report - both documents are available on this page.

We considered all feedback from stakeholders in making our determination, balancing this with the relevant provisions and matters we must have regard to under the Essential Services Commission Act 2001, Electricity Industry Act 2000 and the pricing order.

About us

The Essential Services Commission is an independent regulator that promotes the long-term interests of Victorian consumers with respect to the price, quality and reliability of essential services. We regulate Victoria’s energy, water and transport sectors, and administer the local government Fair Go Rates system.