Apr-23 Energy Market Report

Jay Ros -

Compared to April last year generator behaviour revealed black coal generators moving offers from the extreme price bands down to the $300/MWh to $500/MWh price band, Hydro generators moved extreme price offers down to the $500/MWh to $1000/MWh price band, and gas-powered generators moved more offers above $300/MWh. Generation from baseload generators for April was the lowest on record, while generation from renewables was a record for April thanks to a significant jump in utility-scale solar generation.

It was out with the old, and in with the new during April. Liddell Power Station closed its doors after more than 50 years of service, while SA welcomed the arrival of Australia's new biggest battery, the 250MW/250MWh Torrens Island BESS. The market now waits with bated breath to see how the market will respond to the closure of Liddell, especially as we move into winter. The forecast for warmer temperatures over the coming months will likely see lower demand, and a drier forecast might also mean less cloud and more solar generation.

In the wholesale gas market, domestic spot prices rallied during April averaging above $12/GJ for all gas hubs. Large-scale Generation Certificates continued to rally in April, the LGC spot price closing the month above $52/certificate.

1.0 Overview

The highlights of the month are:

  1. Wholesale electricity spot prices remained high during April pushing up the average price year-to-date across the NEM above $90/MWh for the month
  2. Total energy consumption was at the lowest level for April since 2004 as a result of mild weather and record April Rooftop Solar generation
  3. The weather outlook shows maximum temperatures are likely to be above average for most of Australia over the coming 3 months, with low rainfall for most of the country
  4. The most notable change in generation offers was gas-powered generators moving offers above $300/MWh, less capacity offered by black coal generators but more capacity offered in the higher price bands above $300/MWh, and hydro generators continued to offer more capacity in the $500/MWh to $1000/MWh price band since Jun-22
  5. New generation connections during April included the 173MW Dulacca Wind farm (Qld) and the 250MW/250MWh Torrens Island Battery (SA) which is now the largest battery in Australia
  6. Baseload generation was at the lowest level for the year with low generation from coal and gas generators. Wind generation was the lowest in 12 months, while both utility-scale and rooftop solar PV generation were substantially higher than April in past years
  7. Baseload outages were at average levels during April for Qld, NSW and Vic
  8. April featured the significant retirement of Liddell Power Station
  9. Wind generation curtailment was higher than the previous year for all regions, while solar curtailment was significantly higher for Qld and SA, and slightly lower for NSW and Vic
  10. Snowy Hydro water storages remain at the highest level for April since 2012, while Hydro Tas storage levels were at the lowest level since Aug-22 and only marginally above the state's Prudent Storage Level (PSL). It is noted that Tas pulled a lot of energy from Victoria during summer
  11. Wholesale electricity forward prices softened in Qld and NSW, while prices for the southern regions strengthened
  12. Average wholesale gas spot prices for April increased by almost $3/GJ compared to the previous month with prices for all gas hubs averaging above $12/GJ
  13. LGC spot prices continued a three-month rally climbing to $52.50/certificate