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Consumer Action welcomes the opportunity to provide our submission to the Essential Services Commission (ESC) Draft Decision of the Victorian Default Offer 2024-25. 

We welcome the ESC’s draft decision to reduce the VDO by 6.4% for 2024-25 and we urge the ESC to consider further reducing the VDO price in light of growing and persistent energy hardship and debt for consumers amidst ongoing impacts of climate change. 

Consumer Action has seen a significant increase of Victorians in paid employment contacting the National Debt Helpline (NDH) for energy hardship assistance in the last year. This comes alongside increases in the amount of energy debt our callers reported struggling with, and increased reported occurrences of energy retailers providing inadequate hardship assistance. 

As the short and long term crises of cost of living and climate change converge, the VDO’s intent and purpose sits central to providing a reasonable and trusted electricity price for Victorians.  

As an essential service, energy is central to every aspect of our lives. The ability to afford essentials has become an issue for an increasing number of Victorians, as part of the ongoing cost of living crisis. The VDO can  play a role in stabilising the basic cost of one of  these essentials, and should be considered against this broader context. 

We reaffirm the important purpose of the ESC to promote the long-term interests of Victorian consumers with respect to price, quality and reliability of essential services, as well as the requirement to consider the benefits and costs for low income and vulnerable consumers, in delivering on this purpose. 

In this submission, we provide several recommendations for the ESC to consider when making its final decision for the VDO 2024-25, including on its approach to the pricing methodology, as part of ensuring the VDO continues to be a simple, trusted and reasonable electricity price for Victorians.  

Read the full submission and recommendations (PDF).