Victorian Midday Power Saver: Save on Electricity with Free Power Hours

The Victorian Labor government has clarified the particulars of its innovative Midday Power Saver initiative, announcing that the complimentary electricity period will take place from 11am to 2pm. This announcement includes adjusted estimates on potential savings for households, in light of the recently lowered default electricity prices revealed this week.

Back in March, Victoria stated that its response to the federal Labor’s Solar Sharer programme would be accessible to residential users through the Victorian Default Offer (VDO) beginning 1st October, just months ahead of the upcoming state election.

Key Details from the Energy Minister

This week, State Energy and Climate Minister Lily D’Ambrosio confirmed essential aspects of the free power plan, revealing that families opting into the scheme could save anywhere from $149 to $1,102 annually, depending on how much energy usage they shift to the midday hours.

The federal Solar Sharer was introduced last November as part of reforms to the Default Market Offer (DMO). It mandates electricity retailers in various states to provide free power for a minimum of three hours during midday, with exceptions for Victoria. This federal scheme will commence on 1st July.

For the Solar Sharer initiative, the free usage timings are set from 11am to 2pm in New South Wales and South East Queensland, while South Australia has 12pm to 3pm. It’s worth noting that these times will remain consistent regardless of daylight saving changes.

Aiming for Energy Equity

The rationale behind both free power initiatives is to address energy inequality by extending the financial benefits of rooftop solar to those who may not have the option to install it for various reasons. Moreover, they serve as an incentive for households to manage their energy consumption during the day, optimising the surplus solar energy that frequently saturates the grid.

This initiative also aims to reshape the political conversation surrounding the transition to renewable energy, ensuring that the benefits are equitably distributed among the populace.

Consumer Choices and Regulatory Updates

The Australian Energy Regulator (AER) recently reminded retailers that starting from July, they will be obliged to offer the Solar Sharer as an opt-in energy plan to any customer with a smart meter, not limited to those on the DMO.

AER chair Clare Savage highlighted on Tuesday that the new Solar Sharer Offer provides an opportunity for households to save further by shifting certain electricity usage—such as running washing machines, using air conditioning, or charging electric vehicles—into the midday timeframe. She encouraged consumers to engage their retailers regarding this fresh option, indicating it could significantly reduce electricity bills for some households.

Additionally, Savage noted that incorporating the Solar Sharer Offer into the DMO lends it further protection as it adopts a regulated pricing structure, ensuring consumers are not overcharged for electricity consumed outside the designated free hours.

It’s also pointed out that retailers must inform customers that the Solar Sharer may not be suitable for everyone, and an opt-in agreement is a prerequisite for any customer to join the Solar Sharer.

Price Adjustments Across Australia

This week, both the AER and Victoria’s Essential Services Commission (ESC) released their final determinations regarding default prices for different states and distribution networks, confirming decreases in prices across the board, with South Australia being the only exception.

According to the AER, residential standing offers in DMO regions will see reductions ranging from 3.4% to 5% in New South Wales, and a 7.2% decrease in South East Queensland compared to previous rates. Conversely, South Australia will experience a slight increase of around 1.4% (approximately $33), though some time-of-use retail customers may see lower prices.

In Victoria, the ESC projects that domestic customers under the VDO will benefit from reductions between $50 and $160, averaging roughly a 5% decline year-on-year. Small businesses can expect similar savings, with decreases recognised across five distribution zones averaging around 6% compared to the previous year.

A Top Offer for Victorians

In her statement on Thursday, Minister D’Ambrosio highlighted that VDO customers are faring better than counterparts in other states regarding the average DMO prices, indicating that the upcoming VDO for 2026–27 is expected to be $444 cheaper for households and $1,299 less expensive for small businesses.

D’Ambrosio asserted that the Midday Power Saver will establish the most comprehensive offer of its kind nationally, eligible to all of the 2.6 million households equipped with smart meters in Victoria, compared to a combined total of 2.4 million in other states.

“Having three hours of free power daily will significantly alleviate household costs, and the reduced prices outside that window will allow families to save even more,” D’Ambrosio stated confidently.

Important Considerations for Consumers

However, there are essential caveats regarding the Midday Power Saver plan, including the possibility that electricity prices outside the designated hours may be marginally higher, with actual savings reliant on a household’s capacity to adjust usage from peak periods to midday.

To sign up for the Midday Power Saver, customers are advised to reach out to their electricity retailer starting in October to ascertain whether the offer aligns with their requirements. During this engagement, retailers will need to:

• Inform customers of any other suitable plans based on their energy usage.
• Communicate that the Midday Power Saver might not be ideal for everyone and is best suited for those who can adapt their electricity use.
• Provide details regarding how the new pricing structure may impact costs, including estimates where possible.

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