Energy News
AEMC Moves to Limit Retail Electricity Price Hikes to Once a Year
Electricity retailers will soon face tighter rules to prevent mid-year price increases.
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Important Points
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On June 19, 2025, the Australian Energy Market Commission (AEMC) introduced new reforms and measures that are designed to provide consumers with greater protection against unexpected electricity price hikes.
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The four rule changes are: Ensuring energy plan benefits last the length of the contract, removing unreasonable conditional discounts, preventing price increases for a fixed period under market retail contracts, and removing fees and charges
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The new rules will go into effect starting July 1, 2026, giving retailers 12 months to put them into place. The AEMC will publish its final determination in September 2025.
Not sure how these changes affect you? We’ve got you covered. Keep reading to find out how the new rules work, why they matter, and what they could mean for your household’s power bills.
Retailers Will Be Limited to One Price Increase Per Year
Under the new reforms that begin July 1, 2026, energy retailers will only be allowed to raise prices once every 12 months.
According to the AEMC, this will mean prices may increase either:
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once within the month of July each year (for the majority of customers) or
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no earlier than the anniversary of the contract and no sooner than 12 months from the previous price increase where the contract has a fixed price for a period of time after the contract start date.
Under the new rules, that single annual adjustment will coincide with updates to the Default Market Offer (DMO), which can help customers better anticipate and budget for any increases ahead of time.
Retailers must also ensure that customers on plans with temporary benefits aren’t automatically rolled onto more expensive rates once those benefits end, especially if the new rate is higher than the government’s default market offer.
In addition, the AEMC has banned what it describes as “unreasonably high penalties” for late bill payments. Vulnerable customers will be shielded from certain fees, aside from the necessary network charges. And for everyone else, Providers must limit fees charged to ‘reasonable costs’.
AEMC Chair Anna Collyer described the new rules as a “significant milestone in consumer protection,” following formal requests from state energy ministers in August last year.
“For the first time, we’ve applied our updated equity guidance to these rule changes,” she said, “specifically looking at how contract terms, benefits, and fees can unfairly impact vulnerable consumers.”
Ms Collyer added that limiting energy price increases to just once per year would give households greater certainty over their energy costs and help protect them from unexpected mid-year price spikes.
1Draft Proposal Could Make Cheaper Plans Easier to Spot
According to the Australian Energy Regulator, 40% of consumers¹ miss out on savings simply because they don’t realise there’s a better deal available.
In an attempt to reduce this number, the AEMC has also announced a draft proposal that requires retailers to make their “better offer” message more prominent, displaying it clearly in emails and bill summaries, so that nobody misses out.
2Rules Are Changing, But Finding a Better Deal Is Still Up to You
Energy retailers still set their own rates, and plan prices, discounts, and conditions can vary significantly. That’s why using a comparison tool, like the one below, can pay dividends in the long run. It helps you see where your current plan stands when compared to other market offers in your area. Switching takes as little as 15 minutes, and the potential savings could be more impactful than you might think.
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What Happens Next?
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These reforms take effect July 1, 2026, with a 12-month rollout period for retailers.
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Regulations targeting hardship customers begin December 30, 2026.
Why These Changes Matter
You might be wondering how these energy rule changes actually affect your home, your bills, and your day-to-day life. Here’s why they matter, and what they could mean for you:
1. More predictable bills you can actually plan for
Energy providers can now only raise rates once a year. While this won’t stop prices from going up, it does mean changes are easier to anticipate, which allows for more control over how and when you adjust your usage.
2. ‘Fairer’, more transparent billing
If you’ve ever been hit with late fees, confusing charges, or been moved to a pricier plan without realising it, you’re not the only one. These upcoming changes aim to put an end to those practices. That means fewer nasty surprises and more transparency when it comes to your bills.
3. Better visibility of cheaper plans (pending draft proposal)
Have you ever stuck with a provider simply because it’s hard to tell what’s actually a better deal? That could be changing, too. If the latest draft proposal is passed, energy bills will need to clearly show if there’s a ‘better offer’ available, so you can switch if you feel your plan is overpriced.
Author
Benjamin TomBenjamin is a utility specialist passionate about creating informative content about the energy, internet, and solar markets. With extensive experience in the telecommunications industry, Benjamin drives our unique blog posts, articles, and reviews. He is focused on breaking down the technical jargon so our readers can better understand the telco market and industry. Whether he is comparing the latest internet deals or creating unique guides, Benjamin takes great pride in creating helpful, easy-to-read content.
Sources:
¹Retail energy market performance update for Quarter 2, 2024–25, Australian Energy Regulator (AER), https://www.aer.gov.au/publications/reports/performance/retail-energy-market-performance-update-quarter-2-2024-25
Rule determination National Energy Retail Amendment (Improving consumer confidence in retail energy plans) Rule 2025, Australian Energy Market Commission, https://www.aemc.gov.au/sites/default/files/2025-06/ICCIREP%20-%20Final%20determination.pdf
