Price Hikes Are Coming—Now’s the Time to Act
Electricity bills for Australian businesses are going up. The Australian Energy Regulator (AER) has confirmed that business electricity tariffs will rise by up to 10% in 2025. These increases apply to the Default Market Offer (DMO), which acts as a price safety net for small businesses and households across New South Wales, South-East Queensland and South Australia.
For many business owners already stretched thin, this comes as another financial pressure. But with the right strategy—starting with comparing your business electricity plan—you can manage risk and maintain your competitive edge.
“When prices go up, the smartest businesses don’t panic—they compare, strategise and act early,” Energy Advisor Lead, at Compare Business Electricity.
What’s Causing the Price Rise?
The AER’s announcement cited several factors behind the hike:
- Rising wholesale electricity costs, driven by global fuel markets and supply constraints
- Increased network charges, needed to fund upgrades to ageing infrastructure
- Retail costs, including compliance and billing
You can read the AER’s full 2025–26 pricing determination here.
The AER’s role is to balance fair pricing for customers with maintaining a healthy retail energy market. While the DMO prevents price gouging, it’s not necessarily the cheapest option.
How Much More Will You Pay?
If you’re a small business in:
- New South Wales: Expect up to an 8.7% increase in your annual bill
- South-East Queensland: Around a 7.2% rise
- South Australia: Approximately a 9.6% increase
These are averages. Your actual increase will depend on your usage, provider, and how your plan compares to the DMO.
Businesses that haven’t reviewed their electricity plans recently are most at risk of being hit hard. That’s where comparison tools and professional advice come in.
What Is the Default Market Offer (DMO)?
The DMO is a regulated price cap that protects customers who don’t engage in the market or are placed on standing offers.
Introduced in 2019, the DMO aims to:
- Stop customers from paying excessively high rates
- Promote transparency in energy retailing
- Encourage customers to engage with the market
But while the DMO offers a safety net, it’s rarely the cheapest rate available.
Why Comparing Business Electricity Plans Matters More Than Ever
Many businesses still remain on legacy or standing contracts that haven’t been optimised for years. With electricity making up a significant portion of operational costs, this is a missed opportunity.
Key reasons to compare business electricity:
- Price volatility: Locking in a better rate can provide certainty during market fluctuations
- Contract conditions: Newer plans often have better flexibility or value-add services
- Broker support: An energy broker can negotiate directly with retailers to find custom solutions
“The businesses that engage in procurement—not just pay bills—are the ones that grow sustainably in volatile markets,” Our Energy Advisor Lead.
Case Study: Retailer vs Broker Negotiated Offer
Let’s consider a mid-sized business using 50,000 kWh per year in NSW:
- Standard standing offer (DMO level): 30c per kWh
- Broker-negotiated market offer: 24c per kWh
Annual savings: 6c x 50,000 kWh = $3,000
And that’s not including potential additional charges such as network tariffs, environmental levies, or demand-based pricing structures. A broker ensures all line items are negotiated.
Beyond Comparison: Strategies to Reduce Costs
While comparing plans is essential, a holistic energy strategy offers deeper benefits:
- Demand Analysis
Understand when and how your business uses energy. This helps in shifting consumption away from peak pricing hours. - Energy Efficiency Upgrades
The Federal Government and various state programs continue to offer grants for LED upgrades, power factor correction and HVAC improvements. More info available at energy.gov.au. - Solar and Battery Installations
Commercial solar prices have dropped by over 50% in the last decade. Pairing it with storage can shave significant off-peak and demand charges. - Power Purchase Agreements (PPAs)
For larger operations, corporate PPAs can provide access to fixed, long-term renewable electricity at competitive prices.
The Role of Energy Brokers: Not Just Price Comparison
Energy brokers have evolved beyond just comparing plans. Today, they offer:
- Market intelligence and price forecasting
- Renewable integration strategies
- Risk mitigation tools for high-consumption clients
- Tailored procurement frameworks for multi-site businesses
Their role is especially vital during regulatory changes or major price shifts, like those seen in 2025.
Upcoming Market Changes to Watch
- Coal closures: The Eraring Power Station is slated for closure in 2027. This could further tighten supply and push prices higher. (Source: ABC News)
- Network investment: The $4.3 billion investment in new transmission lines across Victoria will affect network costs nationwide. (Source: RenewEconomy)
- Regulatory shifts: The AER is reviewing frameworks around default offers, environmental levies and retailer obligations. Expect more changes in 2026.
Action Checklist for Businesses in 2025
- Compare your current electricity plan to market rates
- Engage with an accredited energy broker
- Explore energy efficiency funding opportunities
- Model future cost exposure using historical usage
- Monitor regulatory changes through AER and state agencies
Don’t Wait for the Next Price Hike
Electricity prices are going up. But that doesn’t mean your business costs have to. By acting now—comparing rates, engaging expert brokers, and exploring efficiency upgrades—you can stay ahead of the market.
The cost of doing nothing could be thousands of dollars a year.
Need help making your next move? Start with a free plan comparison at Compare Business Electricity.
