Victoria’s Essential Service Commission (ESC) has announced the 2026–27 Victorian Default Offer electricity price (VDO) will see price drop beacuse of lower environmental, wholesale and network costs.
Cheaper bills ahead.
The decrease in annual bills for residential Victorian Default Offer customers range from $160 in the AusNet area, to $50 in the United Energy area (based on annual usage of 4,000 kilowatt hours).
The decreases in annual bills for small business Victorian Default Offer customers range
from $502 in the AusNet area, to $151 in the Powercor area (based on annual usage of
10,000 kilowatt hours).
Why the VDO matters.
The Essential Services Commission, Victoria’s energy regulator, sets a safety net price each year. The VDO only applies to the 512,000 households and 62,000 small businesses currently on the Standing Offer, who are unable or unwilling to engage in the retail electricity market. In setting the VDO Price, the Regulator considers everything that makes up power prices, including wholesale electricity, futures contracts, network, environmental, and retail costs. As a result, any change in the VDO is seen as a good gauge of what’s set to happen with electricity prices for all consumers.
What about my rates?
Most Victorian energy customers are on cheaper market offers and will receive price change notices in the coming weeks. Customers shouldn’t be receiving any big surprises when it comes to their current offers.
It pays to shop around.
In each of the five Victorian energy networks in May 2026, households on a flat rate tariff could pay 27% less than the VDO price. So, significant savings are available by comparing all retailers and switching to a cheaper power plan. See the latest ranking of retailers cheapest electricity plans for Victoria here.
2026-27 Residential DMO electricity prices by network.
Change in average annual Victorian Default Offer bills for residential customers on a flat tariff (4,000 kWh/year)
| Residential VDO | Ausnet | Citipower | Jemena | Powercor | United Energy |
|---|---|---|---|---|---|
| 2026–27 | $1,748 | $1,481 | $1,563 | $1,633 | $1,529 |
| 2025–26 | $1,908 | $1,546 | $1,638 | $1,703 | $1,579 |
| % change | -$160 (-8%) | -$65 (-4%) | -$75 (-5%) | +$70 (-4%) | -$50 (-3%) |
New three-period Time of Use tariff brings savings.
The big change that Victorian households on a time of use tariff will start to see from July, is inclusion of a “solar sponge” period, bringing cheaper daytime power.
The Time of Use tariff will now include three periods.
- Peak period: 4 pm to 9 pm everyday
- “Solar soak” period: 11 am to 4 pm everyday
- Off peak period charge 9 pm to 11 am everyday
The new “solar soak” period will apply everyday between 11am to 4pm, and households are set to receive lower priced power. With networks charging cheaper rates and day-time wholesale prices low thanks to abundant renewables, households should expect to pay at least 5 cents less than the Off-Peak. This is based on the Default Offer Pricing caps for each period.
We anticipate that Victorian retailers will move quickly to implement the new tariff in market offers and also to provide this to their existing customers.
2026-27 Small Business DMO electricity prices by network.
Change in average annual Victorian Default Offer bills for small business customers on a flat tariff (10,000 kWh/year)
| Business VDO | Ausnet | Citipower | Jemena | Powercor | United Energy |
|---|---|---|---|---|---|
| 2026–27 | $3,896 | $3,033 | $3,488 | $3,357 | $3,124 |
| 2025–26 | $4,398 | $3,186 | $3,720 | $3,508 | $3,290 |
| % change | -$502 (-11%) | -$153 (-5%) | -$232 (-6%) | -$151 (-4%) | -$166 (-5%) |
Check your plan at least once a year.
A big watch out is the price of market offers for existing customers. Over time, rates charged to existing customers creep up. This is why households should check their energy costs at least annually against the best offers to make sure their pricing is fair. While retailers are required to advise on each bill, if a cheaper plan may be available, not enough people are taking this up. If you don’t ask, you don’t get the savings.
Compare and save.
Finding a better deal starts with comparing all retailers’ current offers to your current energy plans and making a change. Once you know the best deals, you can ask your current retailer to improve your offer or switch to a cheaper retailer. You can start your comprehensive comparison here with WATTever.