In a statement issued on Wednesday, the NBN Co said the concession would be for at least three months and would apply to all fixed line, fixed wireless and satellite technologies.
RSPs have to pay two kinds of charges to NBN Co. The AVC is a single price per connection based on the peak speed of that connection which means that higher speeds would cost more.
The second charge is for CVC – the total bandwidth that an ISP requests to use across all its services in an area.
It said it would waive "any additional changes for overage that would otherwise be incurred by RSPs over the next three months, and will continue to monitor the situation in terms of any further decision making required".
NBN chief executive Stephen Rue said: "We have been in regular talks with retailers over the past couple of weeks to understand the wholesale network support they require to meet the needs of more Australians working from home and as individuals, couples and families across the nation are spending more time at home, and naturally wanting to stay productive and connected to family and friends.
“We’re proud to play our part to keep Australians connected and productive through this crisis.
"Data carriage on the NBN has already increased by around 5% to 6% over the last few days as customers have increasingly started to work from home.
"The NBN is performing well, and we have not seen or experienced any significant traffic congestion on the network."
Rue added that the additional capacity pricing relief would be offered at no additional cost and would help support significantly greater data use on the network throughout the day and during peak evening times.
"The offer will be made available to the industry from Monday in time to meet the steadily growing data consumption patterns of residential and business customers," he said.
The Australian Labor Party welcomed the NBN Co's decision, with Shadow Communications Minister Michelle Rowland congratulating the company for "acting in the public interest".
On Monday, Labor had called on the company to consider temporary capacity relief.
"Connectivity is vital, whether it be for teleworking, telehealth, education or keeping our spirits up with entertainment," she said.
"This is an example of how industry can work together to support the Australian community during times of crisis. We saw this during the bushfires and I am pleased we have seen it again this week."