Eric Chan

The NEM expanded its capacity by 167MW in October. While demand remained at historical lows, Generator-weighted Average prices strengthened across most regions. VIC continued to experience persistent negative prices, causing energy flows to shift towards regions with more favourable pricing.

Mild sunny weather led to record low minimum demand for the NEM as well as record lows in VIC and SA. Meanwhile QLD and NSW continued to separate from the rest of the NEM with significantly stronger power spot prices. Gas spot prices continued to rise with average prices around $13/GJ in October.

NEM capacity grew by 340MW in September. Strong winds and mild weather led to lower demand and extensive curtailment, depressing Generator-Weighted Average prices. Many farms increased reliance on Large-scale Generation Certificates for revenue. TAS transitioned from importer to net exporter to VIC.

The NEM Q3 average price finished the highest since the 2022 Energy Crisis despite extremely low September prices for VIC and TAS. In SA, volatile winds drove volatile spot prices, while mild days with high VRE crushed prices in VIC and TAS. Meanwhile, NSW and QLD had above average price levels.

Forward electricity contract prices went for a wild ride in Q3-24. Volatile weather played a significant part in driving price outcomes, with strong price rallies in July and August followed by softening prices in September, closing well below market expectations at the beginning of the quarter.

NEM capacity grew by 1,678MW in August. With temperatures rising, energy demand dipped, while consistent strong winds boosted supply, resulting in large curtailments and declined Generator-Weighted Average prices in most NEM regions. TAS still depended on VIC energy exports due to hydro shortage.

Cold weather and low VRE generation contributed to extreme prices early in August. This was followed by unusually warm temperatures, softening demand, falling gas consumption and softer spot prices driven by record levels of renewable generation.

It has been a wild ride this winter in the forward market driven by turbulences in the spot market, structural changes in spot outcomes, prevailing weather conditions and challenges facing the market.

Electricity spot prices remained high across the NEM in July as very low temperatures drove strong demand. SA experienced extreme price volatility late in the month as cold temperatures coincided with very low wind generation. East Coast gas spot prices also remained high averaging above $13/GJ.

The NEM added 311MW of new generation capacity in July. Calm and cold weather conditions in SA, VIC, and TAS at the end of the month led to low wind output and market volatility. Gas generation increased to compensate. VIC exports to TAS reached record high levels for July.

NEM fossil fuel generation ramped up to offset the lowest wind generation for June in seven years. In Tasmania, hydro generation fell to the lowest level since 2009, Tamar Valley fired up for the first time in five years, and energy imports from VIC were the highest for June since 2017.

Electricity and gas spot price volatility intensified in June. The portion of electricity spot prices around $300/MWh swelled pushing average monthly prices beyond $150/MWh. Average daily gas hub prices hit $28/GJ in Sydney and Melbourne after AEMO announced a gas supply risk for the coming months.