In mid-March, the Australian Energy Regulator will release its Draft Default Market Offer for 2026–27. It sounds technical, but this document quietly shapes what millions of households end up paying from July. After two years of sharp increases, many homeowners are watching closely for signs that electricity prices are finally easing.
Early industry chatter points to possible stabilisation rather than another jump. For some households, that alone would feel like a win. For solar owners, though, the story is more complicated.
This March draft will not change prices overnight, but it will set expectations for the year ahead. Retailers, installers, and policymakers all read it as an early signal of where bills are heading.
What the Draft Default Market Offer actually is
The Default Market Offer, or DMO, acts as a price ceiling for standard electricity plans in each network region. It is set by the Australian Energy Regulator and updated every year.
Even if you are not on a default plan, the DMO still matters. Retailers often anchor their market offers around it. When the DMO rises, discounts shrink. When it stabilises or falls, competitive pressure tends to return.
The March release is the draft version. It shows the regulator’s thinking before final prices are locked in around May and applied from 1 July.
Why this year’s draft is getting extra attention
Households are coming off some of the steepest electricity increases in recent memory. Network costs, wholesale volatility, and inflation have all pushed bills higher through 2024 and 2025.
The question now is whether those pressures are easing fast enough to show up in 2026–27 pricing. The AER’s initiation paper suggests some cost drivers are no longer accelerating at the same pace. That opens the door to flatter pricing, even if outright cuts remain uncertain.
For many households, a year without another hike would already feel like progress.
Could July electricity prices actually fall?
There are a few realistic scenarios emerging.
In the most optimistic case, wholesale costs continue to soften, and network increases remain modest. That could allow small reductions in some regions, particularly where past increases were steepest.
A more likely outcome is stabilisation. Prices stop climbing, but they do not meaningfully fall either. In practical terms, this still eases pressure on household budgets compared with recent years.
The least welcome scenario is uneven outcomes. Some regions may see relief, while others continue to face higher network or infrastructure costs that keep bills elevated.
The draft DMO will not give final answers, but it will narrow the range of possibilities.
Why solar households need to read this differently
For homes without solar, the DMO mostly affects how much electricity costs to consume from the grid. For solar households, pricing is increasingly about how electricity flows both ways.
Many solar owners focus on feed-in tariffs when they think about value. The DMO, however, influences daily supply charges, usage rates, and how retailers design solar plans.
As rooftop solar penetration grows, regulators and networks are paying closer attention to when and how households export power. That is where the wildcard enters.
Two-way pricing and export charges
Two-way pricing refers to the idea that households may one day pay not just to import electricity, but also to export it during congested periods. The concept is already embedded in policy discussions, even if widespread charges are not yet in place.
The risk for solar owners is not that export fees suddenly appear everywhere overnight. It is that any relief from stabilising wholesale prices could be offset by changes in how exports are treated.
If the draft DMO signals stronger support for cost-reflective pricing, it may point to a future where exporting excess solar is less financially attractive than it has been in the past.
What this could mean for your July bill
For non-solar households, the best-case outcome is modest relief or at least a pause in price rises. The draft will show whether that is plausible.
For solar households without batteries, the picture is mixed. Bills may not rise sharply, but export value is unlikely to improve meaningfully. In some cases, it may quietly deteriorate.
For solar households with batteries or flexible loads, the direction of travel matters more than the headline numbers. Self-consumption is becoming more valuable than exports, regardless of whether prices rise or stabilise.
What to watch when the draft drops in March
The most important signals will not just be the final cents-per-kilowatt figures. Watch how the AER explains cost drivers, network assumptions, and future pricing principles.
Language around congestion, system costs, and equity between solar and non-solar households will be especially telling. These sections often foreshadow where pricing reforms are heading, even if changes are staged slowly.
The bottom line
The March draft will not deliver instant bill cuts, but it will reset expectations for July. After years of increases, even stabilisation would mark a shift in direction.
For solar owners, the message is more nuanced. The future value of rooftop solar is less about headline electricity prices and more about how households use, store, and time their energy.
March will not bring all the answers. It will, however, make one thing clearer: the rules around electricity pricing are evolving, and solar households need to pay attention to more than just feed-in rates.
Energy Matters has been in the solar industry since 2005 and has helped over 40,000 Australian households in their journey to energy independence.
Complete our quick Solar Quote Quiz to receive up to 3 FREE solar quotes from trusted local installers – it’ll only take you a few minutes and is completely obligation-free.
