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Electricity prices in Victoria: why VIC is different

Why Victoria runs its own electricity rules — the Victorian Default Offer, five network distributors, and how the VDO changes the way you compare plans.

By EnergySorted Editorial Team · Updated · 6 min read

Victoria runs its own retail rules

Victoria is part of the National Electricity Market for wholesale energy, but it deliberately opted out of the national retail rules. Instead, the state runs its own retail framework through the Essential Services Commission. That means some of the consumer protections, the price benchmark and the comparison tools work differently in Victoria than in NSW, Queensland or South Australia.

The practical upshot is that Victorian households have their own state-run comparison service and their own regulated reference price. It also means Victorian retailers must follow Victoria-specific rules about how plans are advertised and how customers are moved between offers.

The Victorian Default Offer (VDO)

Victoria’s safety-net price is the Victorian Default Offer, or VDO, set by the Essential Services Commission rather than by the national regulator. Like the DMO elsewhere, it caps what customers on a standing offer pay and acts as the benchmark retailers measure their market plans against.

Because the VDO is set by a different body using different assumptions, you cannot directly compare a Victorian "X% below the reference price" claim with a NSW one — the reference prices are set separately. Within Victoria, though, the VDO is a genuinely useful common yardstick for lining offers up against each other.

Five network zones and price drivers

Victoria has five electricity distributors — CitiPower, Powercor, United Energy, Jemena and AusNet — and, as everywhere, which one serves you depends only on your address. Each sets its own regulated network charges, so identical retail plans cost different amounts across the five zones.

On top of network costs, Victorian prices are driven by wholesale market conditions, the state’s ageing brown-coal generation fleet and its rapid shift toward wind, solar and storage. Victoria also has strong rooftop-solar uptake, which pushes daytime wholesale prices down but does little to help households that use most of their power in the evening peak.

How to compare and switch in Victoria

Switching is free and does not interrupt supply, and Victorian customers get some of the strongest switching protections in the country, including rules that require retailers to tell you when a better plan of theirs exists.

Even so, "a better plan from your current retailer" is a narrow question. The bigger saving usually sits with a different retailer entirely. EnergySorted costs every AER-listed retailer’s plans against your real Victorian usage and network zone, so the comparison reflects your actual annual cost rather than a single retailer’s best offer. It is about $39 a year and takes no commissions.

Frequently asked questions

Why does Victoria have different electricity rules?

Victoria opted out of the national retail energy rules and runs its own framework through the Essential Services Commission. Wholesale energy still comes through the National Electricity Market, but retail protections and the price benchmark are set at state level.

What is the Victorian Default Offer?

The VDO is Victoria’s regulated safety-net price, set by the Essential Services Commission. It caps standing-offer prices and serves as the reference point retailers compare their market plans against.

How many network zones does Victoria have?

Five: CitiPower, Powercor, United Energy, Jemena and AusNet. Your zone is fixed by your address and affects the regulated network portion of your bill.

Can I compare a Victorian offer against a NSW one using the reference price?

Not directly. The VDO and the DMO are set by different bodies using different assumptions, so a percentage below the reference price only makes sense within the same state.

Is switching retailer in Victoria worth it?

Often, yes. Victorian rules make retailers flag their own better plans, but the largest savings usually come from moving to a different retailer. Costing every retailer against your real usage is the only way to know.

See this on your own bill

EnergySorted costs every plan in your area against your actual usage.

General information only, current at the time of writing — not financial advice. Rebate schemes and rules change; always confirm details with your retailer or state government energy site.