Energy Consumers Australia welcomes the opportunity to provide feedback to the Australian Energy Regulator (AER) on its Draft Determination for the Default Market Offer Prices 2022-23.  

We commend the AER’s decision to adopt a bottom-up approach to setting the Default market Offer (DMO) as this will address issues around transparency of retail costs. However, we consider that the AER’s chosen retail margin of 10% for residential customers and 15% for small business customers is unjustifiably high and therefore does not best meet the DMO’s objectives around consumer protections.

We submit that in the Final Determination:

• the retail margin be of a magnitude similar to those used in the regulated standing offers of other jurisdictions.
• the retail margin should be the same for small business and residential consumers. This is because any difference in the cost to serve has been accounted for in other elements of the cost stack.

Read the full submission containing these and other recommendations below.