Victorian electricity distributor United has announced a move it says will cut the average annual household by $55 a year for its clients.

News Corp media outlets say United is planning a reduction in network spending to ease the pain for its 650,000 members.

United customers – who live in areas of southeast Melbourne and the Mornington Peninsula – should expect their bill to fall to $375 a year for the next five years under the draft plan, the Herald Sun reports.

Distribution costs make up about 30 per cent of the average Victorian residential power bill.

The distributor is planning to submit the plan to the Australian Energy Regulator next month, after getting early feedback from customers.

United says lower borrowing costs, reduced smart meter fees and declining electricity demand prompted it to reduce its network spend.