Electricity prices dropping across most states from July – except one

Australian households are set to see electricity prices fall from 1 July.

This follows the Australian Energy Regulator (AER) releasing its final Default Market Offer (DMO) prices for 2026-27, delivering some welcome cost-of-living relief.

The DMO, which applies in NSW, South East QLD and South Australia, is a regulated price cap on standing offer electricity plans.

This is the default plan you're typically placed on if you haven't actively chosen a market offer.

It also acts as a reference price, making it easier to compare market offers if you shop around for energy plans.

Meanwhile, Victoria sets its own benchmark pricing through the Victorian Default Offer (VDO), where new prices revealed yesterday show a 5% drop.

Price changes by state from 1 July 2026

The final decision confirms price drops across NSW and South East QLD.

South Australia is the exception, with some households set to see a small increase.

Here's how the changes break down for residential customers on a flat rate standing offer, meaning you pay just one rate for your energy use throughout the day:

• NSW: Prices fall by 3.4% to 5.0% (saving $66 to $137 a year, depending on your distribution zone)
• South East QLD: Prices fall by 7.2% (saving around $155 a year)
• South Australia: Prices rise by 1.4% (an increase of around $33 a year)

What about time-of-use pricing?

If you have a smart meter and you're on a time-of-use standing offer, the price changes look a bit different. This means you pay different rates depending on when you use electricity.

• NSW: Prices will fall by 3.7% to 7.7%, depending on your distribution zone
• South East QLD: Prices will fall by 10.7%
• South Australia: Prices will fall by 1.1%

So even South Australian households get some relief on time-of-use plans, despite the flat rate increase.

New Solar Share Offer to be introduced from 1 July

From 1 July, retailers will be required to offer a new regulated Solar Sharer Offer for the first time.

This opt-in plan will give you three hours of free electricity in the middle of the day, when solar generation is at its peak.

Despite the name, you don't need to have solar panels installed. It's available to all households in the three DMO regions with a smart meter.

Other key details include:

• The free window is set at 11am to 2pm in NSW and South East QLD, and 12pm to 3pm in South Australia.
• The Solar Sharer Offer is priced the same as the time-of-use DMO.
• Outside the free period, you'll pay slightly higher rates than a flat rate plan.
• It'll benefit households that can shift the use of energy-intensive appliances - like washing machines, dishwashers, clothes dryers and EV charging - into the midday window.

What if I'm not on a Default Market Offer?

Energy retailers also tend to review their electricity prices around this time each year for market offers, with any changes typically taking effect from July.

You should compare plans then to see if you can find a better deal.

"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," AER chair Clare Savage said.

She also noted that retailers are required to let customers know at least once every 100 days if they could be on a better plan.

You can find this information on the first page of your energy bill.

Why are electricity prices dropping?

There were fears that uncertainty from the conflict in the Middle East could push wholesale energy costs higher.

However, that does not appear to be the case.

"The reductions compared to last year reflect easing costs across most components of the DMO, particularly in wholesale energy, where we've seen lower electricity contract prices, reduced spot price volatility, and increased output from wind and battery generation during evening peaks," Savage explained.

"Despite uncertainty created by conflict in the Middle East, wholesale energy costs have not increased."

On top of this, the DMO has also been reformed to remove costs that are harder to justify.