The Australian Energy Regulator (AER) has confirmed notable hikes in electricity prices under the Default Market Offer (DMO) for 2025–26 released today. This decision directly affects household and small business customers on standing offer plans in New South Wales (NSW), with the increases for NSW being more pronounced compared to those in South East Queensland (SE QLD) and South Australia (SA).
PHOTO: The average residential NSW home will see a $228 increase to their annual electricity bill CREDIT: AER
From July 1, 2025, residential customers in NSW on standard contracts will observe price increases of up to nearly 10 percent. In specific terms, customers connected to the Essential Energy network will see their annual costs rise by $228, a 9.1 percent increase under the DMO, leading to an average yearly bill of $2,741, based on a 4,600 kWh annual usage. This contrasts starkly with the increases of up to 3.7 percent in SE QLD and up to 3.2 percent in SA.
Similarly, for small businesses, the increase is projected at 8.5 percent, adding roughly $489 to the annual electricity bill based on 10,000 kWh annual usage.
PHOTO: Price changes according to the AER for Essential Energy customers in NSW as of July 1 CREDIT: AER
AER Chair Ms Clare Savage highlighted the ongoing pressures that influenced the price adjustments. “We know this is not welcome news for consumers in the current cost-of-living environment. As noted in our draft determination, sustained pressures across almost all components of the DMO have driven these price rises, with wholesale and network costs rising in most jurisdictions between 1 and 11 percent, and retail costs between 8 and 35 percent compared with last year,” said Ms Savage. The AER made decisions based on stakeholder feedback, economic conditions, and recent inflation figures.
PHOTO: Currently, 90 to 95 percent of competitive market offers fall below the current DMO price CREDIT: NSW Government
The absence of a competition allowance is intended to ease cost burdens slightly. Still, Ms Savage acknowledged that “not including the competition allowance will alleviate a small amount of cost-of-living pressure on consumers.” She urged consumers to seek better offers, noting that most of these are beneath the DMO price. As of this month, 90 to 95 percent of competitive market offers fall below the current DMO price, with the most economical offers being between 18 and 27 perent cheaper.
Ms Savage advises consumers to remain vigilant regarding their energy plans, encouraging them to “contact your retailer to see if you can get a better offer or shop around.” For those struggling financially, she recommended contacting their energy retailer promptly and exploring available energy rebates and concessions.
For other handy tips on ways to save money off your energy bills, you can also visit the NSW Government Cost-of-living hub.