Electricity Prices July 2026: AER Confirms DMO 8 — Full Breakdown

The Australian Energy Regulator (AER) today released its final Default Market Offer (DMO 8) determination for 2026–27, setting new benchmark electricity prices for households and small businesses across New South Wales, South East Queensland and South Australia from 1 July 2026.

Residential flat rate standing offer prices will fall by between 3.4% and 7.2% across NSW and South East Queensland. South Australia is the exception — flat rate residential prices will rise by 1.4%, an increase of approximately $33 per year. However, all time-of-use customers in all regions — including SA — will see price reductions.

This is the first DMO determination under the Albanese Government's reformed DMO framework, which applies new methodology to calculate standing offer prices. The determination also introduces tariff caps for the first time and cements the new Solar Sharer Offer, which gives eligible households three hours of free daytime electricity.

Approximately 463,000 households (around 8% of residential customers) remain on standing offers. The AER stresses the DMO is not intended to be a competitive market offer — market offers from retailers are typically up to 20% below the DMO reference price.

Flat rate standing offer prices — where customers pay the same rate for electricity at all times — fall in NSW and SE Queensland but rise slightly in South Australia. The table below shows the confirmed annual reference prices for each distribution zone.

Time-of-use customers — who pay different rates depending on when they use electricity — see price reductions in all regions including South Australia. The largest TOU savings are in SE Queensland (-10.7%, saving $229/yr) and NSW Essential Energy zone (-7.7%, saving $211/yr).

Small business customers see significantly larger reductions than residential customers. The biggest savings are in NSW's Essential Energy zone, where time-of-use small business prices drop 20.9% — saving up to $1,303 per year. Flat rate small business prices fall between 6.8% and 11.3% across all regions.

Network charges — which account for roughly 39% to 54% of typical DMO costs — have actually increased across much of the National Electricity Market. But wholesale electricity costs have fallen enough to more than offset that rise in most regions.

According to the AER, wholesale costs fell by between 2% and 14% for the coming financial year, driven by:

• More wind and battery generation entering the system
• Less reliance on expensive gas and hydro generation during evening peaks
• Lower electricity futures prices
• Reduced spot market volatility

Environmental scheme costs also fell sharply, while retailer operating costs eased compared to previous years.

South Australia remains more exposed to network cost increases, which is why it is the only region where flat rate residential prices rise. Federal Energy Minister Chris Bowen highlighted batteries as key to the broader price reductions:

The AER has also adjusted its methodology for DMO 8, adopting a blended network cost approach that reflects the mix of older legacy meters and newer smart meters across the population. This change, part of the reformed DMO framework, aligns with the rollout of smart meters targeted for full implementation by 2030.

The Default Market Offer (DMO) is the maximum annual price a retailer can charge a customer on a standing offer. It was introduced on 1 July 2019 following the ACCC's Retail Electricity Pricing Inquiry, which found standing offer customers were paying significantly more than necessary. The DMO serves two functions:

1. A price cap — retailers cannot charge more than the DMO for standing offers in each distribution zone.
2. A reference price — retailers must show how their market offers compare to the DMO as a percentage (e.g. “15% below the reference price”).

The DMO resets every 1 July and applies to NSW (Ausgrid, Endeavour Energy, Essential Energy), South East Queensland (Energex), and South Australia (SA Power Networks). Victoria has a separate equivalent — the Victorian Default Offer (VDO) — set by the Essential Services Commission.

The DMO directly sets prices for the approximately 463,000 households (~8% of residential customers) in DMO regions who remain on standing offers. These are typically customers who have never actively chosen a plan or switched providers.

However, the DMO also has an indirect effect on the broader market. Because it serves as the reference price, it influences how retailers price and advertise their market offers. When the DMO changes, retailers typically adjust their market offers — though not always by the same amount or at the same time.

Under AER rules, retailers are required to notify customers at least once every 100 days if they could be on a better plan. This information should appear on the first page of your electricity bill.

The DMO has been in effect since 1 July 2019. The table below shows the trajectory of each determination. The 2022–24 period saw the largest increases in the DMO's history, driven by the global energy crisis. DMO 8 is the first determination under the reformed framework.

The DMO 8 determination cements the Solar Sharer Offer (SSO) — a new regulated tariff that gives households access to three hours of free daytime electricity. Retailers with more than 1,000 customers are required to offer it from 1 July 2026.

The SSO is priced the same as the DMO time-of-use tariff, with normal TOU rates applying outside the free window. It encourages households to shift electricity use into the middle of the day when rooftop solar generation is abundant and wholesale prices are often extremely low or negative.

Who benefits most?

• Work-from-home households — running appliances during the free window
• EV owners — charging during midday instead of overnight
• Households with battery storage — charging batteries for evening use
• Pool owners — scheduling pump cycles for midday

Who should be cautious?

Households that consume most of their electricity in the evening peak (5–9 pm) and cannot shift usage to midday may pay more than on a flat rate plan, since TOU rates outside the free window are higher than flat rates.

DMO 8 introduces tariff caps for the first time. Previous DMO determinations only capped annual bills. The new caps also limit maximum daily supply charges and usage rates — not just the total annual price. This makes it easier for households to compare plans line-by-line across flat rate, time-of-use, and Solar Sharer offers.

The DMO only covers NSW, South East Queensland and South Australia. Other states and territories have separate regulatory frameworks:

No. The determination is now final and retailers have pricing certainty. AER Chair Clare Savage said: “Once new prices take effect in July, it will be worth exploring which retailers offer further discounts off the DMO or new energy plans that better suit individual circumstances.”

If you're on a standing offer, you are paying the maximum regulated price. Switching to a market offer could save up to 20% beyond the DMO. Most residential plans have no exit fees, switching takes minutes, and there is no interruption to your electricity supply.