The Essential Services Commissioon (ESC) has begun engagement on their 2025-26 Victorian Default Offer (VDO) prices with their request for comment paper.
Our joint submission with other consumer advocates highlights the importance of the VDO as a safeguard for consumers that are unable or unwilling to engage with the electricity retail market, and a key benchmark price for market offers.
This role is amplified given current cost-of-living pressures and our submission makes several recommendations to ensure it safeguards consumers as best as possible, including:
- Maintain the VDO as a crucial safeguard for consumers who cannot engage with the market, and as a price cap for embedded networks.
- Embed an understanding of the cost of living into all determinations, and consider the impact of decisions on vulnerable customers, as per the ESC’s statutory obligations.
- Select the lowest price estimate whenever there is a range for a component of the VDO price stack, such as the retail margin, or have stated reasons for why the lowest price was not selected.
- Increase transparency on collected retail cost data.
- Examine mechanisms that complement the VDO to create real affordability for low-income households trying to afford an essential service, such as a targeted social tariff for those most in need.
We also submitted an individual accompanying letter that acknowledged the need for broader reviews that ensure consumers have access to simple and affordable energy plans.