The purpose of compliance reviews

Compliance reviews are a key part of the commission's proactive compliance program to promote the long-term interests of Victorian energy consumers. 

The commission can direct licensed energy businesses to undertake compliance reviews. A compliance review is a tailored assessment of an energy business' compliance with particular obligations in Victoria's energy rules and laws.

Compliance reviews are an integral part of the commission's strategy to ensure consumers are protected under Victoria's energy regulations. They provide an impartial and objective assessment of how energy businesses are complying with certain rules. Energy business' obligations include those in legislation, the commission's codes of practice and licence conditions.

Independent reviewers

The energy business must nominate an independent reviewer to conduct the compliance review. The reviewer must be approved by the commission before the compliance review commences. 

Compliance reviews give us flexibility to approve the appointment of a reviewer with the required skills and experience relevant to the review. In some cases, the commission may approve a legal or compliance firm, rather than an audit firm.

We have completed our review of the 2024–25 minimum feed-in tariffs.

The 2024–25 minimum feed-in tariffs will apply from 1 July 2024.

The table below shows the minimum feed-in tariffs for 2024-25. Retailers can offer solar customers a flat feed-in tariff and/or time-varying feed-in tariffs for electricity exported to the grid.

We have updated the inputs in the minimum feed-in tariff model since we released the draft decision. This reflects the most recent data available to us at the time of our final decision.

Why do the minimum feed-in tariffs change each year?

The video below provides a general explanation of what factors might impact changes in the minimum feed-in tariffs.

The minimum feed-in tariffs change each year mostly because of changes in solar weighted wholesale electricity prices.

We estimate solar weighted wholesale electricity prices using the latest information available at the time of publication of each decision. In recent years, solar weighted wholesale electricity prices during the middle of the day, when most solar is exported, have been going down.

The wholesale price is set in a competitive national market, based on energy supply and demand. The wholesale price is not set by the government or a regulator.

The chart below shows how solar weighted wholesale electricity prices are low during the day, when most solar exports happen, but higher at night.

Tips to make the most of your solar

The enduring value for solar customers is avoiding paying retail prices when using the energy they produce themselves.

1. Where possible, run your power-hungry appliances - washing machines, dishwasher - during the middle of the day to avoid higher evening peak prices charged by retailers. Any leftover energy is then exported to the grid and you get paid via the feed-in tariff.
2. Consider the advantages (and disadvantages) of 'time of use' feed-in tariffs when working out which energy retailer meets your needs. Also beware that a higher feed-in tariff may mean you pay higher import tariffs.
3. Plan your daily energy usage to be met during daylight hours when your solar is hard at work.

We are responsible for setting and annually reviewing the Victorian Default Offer prices. The default offer is designed to be a simple, trusted and reasonably priced electricity option that safeguards customers who are unwilling or unable to engage in the market.

We have set the Victorian Default Offer prices to apply from 1 July 2024 to 30 June 2025. 

How cost benchmarks and annual bills will change under our final decision

Victorian default offer prices to apply from 1 July 2024 to 30 June 2025 

Fixed flat tariffs for general usage and general usage+controlled load usage – residential customers (including GST)

Fixed flat tariffs for general usage – small business customers with consumption less than 40 MWh per year (including GST)

Two period time of use tariffs – residential customers (including GST)

Two period time of use tariffs – small business customers with consumption less than 40 MWh per year (including GST) 

Our price determination covers all types of standing offers including those based on time-of-use, demand and flexible tariff structures.

If you're not sure which distribution zone you're in, you can look it up on your electricity bill or view more information on the Victorian Government's energy website.

How we calculate the Victorian Default Offer

We are required to base the Victorian Default Offer on the efficient costs of the sale of electricity by a retailer. In doing so, we take into account:

• wholesale electricity costs – based on the price of electricity costs in the futures market
• network costs – taken directly from tariffs approved by the Australian Energy Regulator
• environmental costs – taken from public information on the costs of environmental initiatives
• retail costs – based on the customer weighted average of retailers' actual costs
• other costs – taken directly from published reports from industry bodies
• network losses – taken from the Australian Energy Market Operator and electricity distributors
• retail operating margin – based on a benchmark from comparable regulatory decisions.

Next steps

Victorian Default Offer 2024–25 prices will come into effect from 1 July 2024.

On 26 October 2023, Ryan Corner Development Pty Ltd (ACN 130 542 915) applied for a licence to generate electricity for supply or sale and to sell electricity under section 18 of the Electricity Industry Act 2000.

Submissions closed 5pm Wednesday 23 November 2023. We did not receive any submissions. 

We granted the licence on 15 December 2023.

On 25 October 2023, Hawkesdale Asset Pty Ltd (ACN 643 793 711) applied for a licence to generate electricity for supply or sale and to sell electricity under section 18 of the Electricity Industry Act 2000.

Submissions closed 5pm Wednesday 22 November 2023. We did not receive any submissions.

We granted the licence on 10 January 2024.

On 30 October 2023, Ferguson Wind Farm Pty Ltd (ACN 608 631 321) applied for a licence to generate electricity for supply or sale, and to sell electricity under section 18 of the Electricity Industry Act 2000 (Vic).

Consultation on the licence application closed on 27 November 2023. We did not receive any submissions.

We granted the licence on 13 February 2024.