25 February 2019
Statement on the Australian Energy Regulator’s draft determination on Default Market Offer prices
Origin Energy Limited (Origin) notes that on 23 February 2019, the Australian Energy Regulator released its draft determination of a Default Market Offer (DMO) for customers on standing offers in New South Wales, Queensland and South Australia.
The impact of the DMO on Origin will be dependent on the final determination, due by 30 April 2019, and to be effective from 1 July 2019.
If the final DMO determination is consistent with the draft determination, then Origin expects that the introduction of a DMO will deliver the following savings to customers:
· approximately 230,000 residential customers saving on average $105 per annum
· approximately 55,000 small business customers saving on average $355 per annum.
The annual impact of this draft determination, from current tariffs, is estimated to be a $44 million reduction in pre-tax earnings from FY2020.
The Victorian market is expected to be subject to separate price regulation, yet to be determined, by that state’s government, from July 2019. In Victoria, all of Origin’s residential standing customers currently receive a highly competitive minimum discount of 17 per cent.
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