Victorian Midday Power Saver Offers Households Free Electricity from 11am to 2pm
The Victorian Labor government has clarified aspects of its Midday Power Saver initiative, revealing that the designated free electricity period will occur from 11am to 2pm. Alongside this, the government has recalculated the potential savings for households following the recent announcement of lower default electricity prices.
Back in March, Victoria announced that its state-specific adaptation of the federal Labor’s Solar Sharer initiative will be accessible to residential customers starting from 1 October – a move that comes just weeks prior to the state election.
Details from the Energy Minister
State Energy and Climate Minister Lily D’Ambrosio has confirmed essential details regarding the plan this week, stating that households participating in this opt-in scheme could potentially reduce their energy bills by anywhere between $149 and $1,102 annually. The exact savings depend on how much electricity consumption is moved to the midday hours.
Understanding Solar Sharer and Its Implications
The federal Solar Sharer initiative was introduced last November as part of the reforms to the Default Market Offer (DMO). This initiative requires electricity retailers to provide free energy for a minimum of three hours during the day in DMO regions, excluding Victoria. The scheme will be implemented starting 1 July.
For the Solar Sharer scheme, free energy periods are set for 11am to 2pm in New South Wales and South East Queensland, while in South Australia, they are from 12pm to 3pm. Importantly, these times will remain consistent regardless of daylight savings changes.
The rationale behind both the Victorian and federal free power offers is to address energy inequities by allowing those unable to install rooftop solar panels to benefit from associated savings. Additionally, the initiative serves to encourage households to adjust their energy consumption to the middle of the day, effectively utilising the excess solar power generated during those hours.
Additional Benefits and Precautions
This effort also aims to reshape political discourse surrounding the shift to green energy by ensuring that its benefits are more widely accessible. The Australian Energy Regulator (AER), which oversees the DMO, recently reminded that from July, retailers must offer an opt-in Solar Sharer plan for any customer with a smart meter, extending beyond those solely on the DMO.
AER Chair Clare Savage noted that the new Solar Sharer Offer presents an opportunity for households to save further by reallocating their energy usage, such as running washing machines or charging electric vehicles during the midday window. She emphasised the importance of discussing these options with retailers to identify the best fit for each household.
Moreover, the AER highlighted that including the Solar Sharer Offer under the DMO’s regulated pricing assures consumers against overcharging during non-free periods. However, it’s worth mentioning that retailers must inform customers that this plan might not suit everyone, necessitating a signed agreement to enrol in the Solar Sharer scheme.
Overview of Price Adjustments Across States
This week, both the AER and Victoria’s Essential Services Commission (ESC) released their final determinations regarding default pricing across Australian distribution zones. The findings confirmed widespread price reductions except for South Australia.
In DMO regions, the AER indicated that the residential flat-rate standing offer would see reductions ranging from 3.4% to 5% in New South Wales and a 7.2% decrease in South East Queensland. In contrast, South Australian consumers would experience a slight increase in annual bills by 1.4% (approximately $33), while those on time-of-use plans may see minor decreases.
For Victoria, the ESC’s decisions indicate that prices for domestic customers under the Victorian Default Offer (VDO) will drop significantly, with decreases ranging up to $160 for AusNet users and down to $50 for United Energy customers, translating to an average 5% annual reduction.
Small businesses will also benefit, with average savings of 6% across five distribution zones in comparison to the prior year, with decreases from $502 for AusNet down to $151 for Powercor.
Anticipated Impact on Households
In a statement, Minister D’Ambrosio highlighted that customers on the VDO have better rates compared to customers in other states under the DMO. The 2026-27 VDO is projected to be $444 less expensive for households and $1,299 more affordable for small businesses than their counterparts elsewhere.
Moreover, D’Ambrosio asserted that the Midday Power Saver initiative is set to be the most extensive offering in the nation, as all of the 2.6 million homes with smart meters in Victoria will qualify, surpassing the 2.4 million in other states combined.
“Three hours of free electricity each day will significantly relieve household budgets, and lower rates outside these hours mean even more savings for families,” she stated, emphasising that “Victorians will enjoy the most advantageous free power arrangement in Australia.”
Important Considerations for Consumers
However, prospective participants should note that while electricity prices may be higher outside of the free period, actual savings will depend on their ability to shift consumption from peak times to midday. To participate in the Midday Power Saver plan, customers should reach out to their electricity retailer beginning in October to determine whether this offering is appropriate for their circumstances. Retailers will need to provide information regarding alternative plans that may be more suitable.
Customers will also be cautioned that the Midday Power Saver may not be the best option for everyone, especially for those who cannot adjust their energy usage, as failure to do so could result in increased costs. Customers may also incur charges for exceeding the fair use cap.
