The Australian government has announced that electricity bills for households and small businesses across parts of the eastern states will decrease by up to 10% from July, driven by record levels of renewable energy and battery storage in the national grid.
Price Reductions Across Eastern States
According to the Australian Energy Regulator's final offer for 2026-27, households in New South Wales and south-east Queensland on standing electricity plans — known as the "default market offer" — can expect price reductions between 3.4% and 10.7% compared to the previous year. Some families could save up to $155 annually. However, South Australian households on a flat rate may see a slight increase of 1.4%.
Small businesses will also benefit significantly, with savings of up to 20.9% in some regions. Businesses in NSW could save up to $1,303, those in south-east Queensland up to $601, and South Australian enterprises up to $673.
Role of Renewables and Batteries
AER Chair Clare Savage highlighted that the large-scale integration of batteries, along with solar and wind energy, has reduced price volatility despite global uncertainties such as conflicts in the Middle East. "Batteries have been displacing more expensive gas and hydro in the evenings, leading to flatter prices throughout the day. This has translated into lower forward electricity contract prices," she explained.
The final offer also introduced the "solar sharer" plan, an opt-in option enabling customers with smart meters to access three free hours of electricity during the middle of the day. Savage encouraged consumers to inquire with their retailers about this new option, which could be transformative for reducing electricity bills.
Victorian and National Trends
Victorian customers on standing offers will also see price reductions, with household bills expected to fall by an average of 5% and business bills by 6%, according to the state's Essential Services Commission. While most Australians are not on standing offers, these default prices serve as an important safety net for approximately 987,000 households and 139,000 businesses across the four states.
Victoria's Essential Services Commission Chair Gerard Brody described the lower electricity prices as "welcome news" for households and small businesses facing cost-of-living pressures. He noted that while shopping around can yield better deals, the default offer provides a simple and fair option.
Energy Minister Chris Bowen attributed the price declines to renewable energy and batteries reducing pressure during peak times. "We know energy bills are still too high — because when coal breaks down, your bill goes up — but this news shows steady progress," he said.
Record Renewable Energy Milestones
The announcement coincides with the release of the Clean Energy Council's annual snapshot, which reveals that Australia is now a top-three global player in batteries and that renewable energy met nearly half of the nation's power in 2025. The report found that renewables supplied 43% of Australia's electricity throughout the year, up from 39% in 2024, with clean energy generating over 50% of power in the national grid during the final quarter.
Australia ranked third globally for utility-scale batteries, behind only China and the United States, with 2 GW of large-scale battery capacity connected to the grid — a 233% increase from the previous year. Home battery uptake surged by 260% compared to 2024, supported by the federal government's cheaper home batteries program, with more than 268,000 small-scale storage systems added in 2025, a number that has since grown to 400,000.
Challenges Ahead
Despite these achievements, Clean Energy Council CEO Jackie Trad warned that the energy transition is approaching a "critical juncture." "The next five years matter most. Our sector's highest priority in 2026 must be to remove the barriers slowing investment in new large-scale wind and solar projects that will ultimately replace unreliable coal generators," she said.
Investment in new onshore wind and solar fell by 48%, signaling a likely slowdown. Only 0.9 GW of wind capacity reached financial close in 2025, compared to 2.2 GW the previous year. The report cited rising inflation, regulatory bottlenecks, slow transmission delivery, and delayed coal closures as factors weakening investor confidence. However, investment in battery storage remained strong, offering a bright spot for the future of Australia's energy landscape.
