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The Victorian Default Offer (VDO) was introduced by the Victorian government to help ensure consumers aren't paying too much for their energy bills.
You can benefit from the VDO in a few ways:
The default offer depends on what energy distributor you have, which is determined by where you live. The Essential Services Commission has a full list of distributors and their VDO prices.
Although the VDO is a fair price, it's unlikely to be the best price you can get. Many market offers from providers will have rates lower than the VDO.
This is by design, since the VDO is intended to stop customers paying ridiculously large sums for electricity, not be the most competitive deal. Here's an example of how plans from a few providers compare to the VDO price.
Energy Retailer | Cheapest Market Offer | Victorian Default Offer | Savings |
---|---|---|---|
Elysian Energy | $1,089 (23% less than VDO) The Good Life | $1,420 | $331 |
Momentum Energy | $1,220 (14% less than VDO) Self Serve | $1,420 | $200 |
Alinta Energy | $1,221 (14% less than VDO) Home Deal | $1,420 | $199 |
Powerclub | $1,230 (13% less than VDO) Powerbank Home Flat | $1,420 | $190 |
Tango Energy | $1,234 (13% less than VDO) EasySave | $1,420 | $186 |
Price assumes general energy usage of 4000kWh/year for a residential customer on a single rate tariff. Estimated price includes any discount that may be available.
The Victorian Essential Services Commission calculated that the VDO saved the typical Victorian household on a standing offer between $200 - $330 on annual bills.*
If you're on a VDO standing offer, you stand to save up to $200 per year by changing to a market offer, according to median bills in the AER's 2019-2020 annual retail market report.
* Source: The Victorian Default Offer
If you haven't checked your energy plan in a long time, purchased a new one or moved, chances are good that you've fallen onto a standing offer. To confirm whether you're on a standing offer, simply check your last energy bill. It will have your contract type listed on it.
To summarise, here are the most important points about the VDO:
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