The relief will be deducted from eligible households' power bills in the next financial year. This is instead of providing cash handouts, which the government said could impact inflation.
But not everyone will get the full $500 benefit, with some unlucky Aussies set to miss out.
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“Because of our policies, electricity price increases are expected to be around 25 percentage points less than what was projected – and 16 percentage points less for gas,” Treasurer Jim Chalmers said.
The $3 billion package is being equally co-funded by the federal government and state governments, with the state and territory governments administering the scheme.
How much will Aussies save?
Aussie households can save up to $500 on their energy bill, depending on where they live. Eligible small businesses can save up to $650. Amounts will vary between states and territories, depending on their electricity prices and systems.
Here's a state by state breakdown:
NSW - $500
Vic - $500
Qld - $500
SA - $500
Tas - $500
WA - $350
NT - $350
ACT - $175
Who is eligible for the energy relief?
Pensioners, veterans, seniors and other concession card holders, as well as recipients of the Carer Allowance, Family Tax Benefit, and anyone eligible for existing state and territory electricity concession schemes will be eligible for the rebate.
Who will miss out on the $500 relief?
Eligible households in Western Australia, the Northern Territory and the ACT will miss out on getting the full $500 relief and will receive a reduced $350 and $175 in total bill relief.
The government has said those experiencing the higher power price rises will be getting slightly more relief.
When will it be available?
The energy relief will be applied automatically to eligible households' power bills from July 1, 2023.
What other energy relief is on offer?
Along with the energy-relief package the government is also investing $1 billion to help provide low-cost loans for double-glazing, solar panels and other improvements.
Small and medium-sized businesses that spend money on electrification and energy efficiency will also be eligible for up to $20,000 in tax relief. This is expected to benefit 3.8 million businesses and will cost $314 million.