Eric Chan

The Q1-25 quarter spot prices finished in the bottom quartile of our spot forecast, creating a significant seller’s margin profit for the quarter. Forward market prices generally rallied during the month, reversing the February downward trend.

In March, 1,147MW of new capacity was connected. QLD was the only region to enjoy an increase in Generator Weighted Average prices, while wind weighted prices fell for all regions. SA solar and wind suffered the most curtailment. VIC was the dominant energy exporter and NSW the largest importer.

The Q1-25 quarter electricity spot prices finished at an unremarkable level, except for Tasmania. Variable Renewable Energy performed strongly, and gas generation was low. Meanwhile, gas spot prices also remained calm, while storage levels were filled, with a falling forward market.

Tasmania’s average spot price for February was the highest in the NEM, despite exceptionally low demand and accounted for almost half of all FCAS cost for the month. East coast gas spot prices remained high at around $13.50/GJ for the DWGM, and $12.50/GJ in Victoria’s STTM.

February brought no new connections to the NEM. Generator-Weighted Average prices improved for solar and wind across most regions, except QLD. Solar and wind farms continued to face large curtailment. VIC was the dominant energy exporter while TAS was the biggest importer in February.

January maximum demand levels were low compared to historical levels resulting in relatively soft spot price outcomes, except for brief price volatility in QLD and NSW. High offers from Hydro kept TAS prices around $120/MWh. Gas prices retreated below $14/GJ in following a lengthy rally in Q4-24.

The NEM added 185MW capacity in January. Generator-Weighted Average prices declined for wind and solar farms in most regions, with solar farms facing deeper discounts to Time-Weighted Average prices. Solar curtailment remained high, particularly in SA. QLD's reliance on NSW during peak demand grows.

In 2024, record new generation capacity joined the electricity market. Wind weighted prices were at record lows for all regions except SA, while higher daytime prices improved solar farm performance across the NEM. Broader ranges in operational demand across regions intensified market volatility.

The energy market was under considerable stress during 2024, leading to higher electricity spot prices. The pain was particularly felt towards the north with QLD and NSW recording their second-highest average prices after the 2022 Energy Crisis.

The NEM expanded its capacity by 121MW in November. Warm temperatures plus extended baseload outages contributed to tight supply-demand balance, driving exceptional NEM Generator-weighted Average price growth in November, with NSW and QLD leading gains.

High prices persisted in the electricity and gas spot markets during November, with extreme electricity spot prices in QLD and NSW, and surging gas spot prices in the STTM. The NEM survived the hottest November on record, but we aren’t out of the woods yet with a hot summer on the radar.

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.