The Australian Energy Regulator (AER) today published a report into energy prices exceeding $5,000 per megawatt hour (MWh) in the National Electricity Market (NEM) and in New South Wales, Queensland, and South Australia and Frequency Control Ancillary Services (FCAS) markets exceeding $5,000 per megawatt (MW) in Queensland during October, November and December 2024.
During the quarter, 30-minute wholesale energy prices exceeded $5,000 per MWh 23 times. This compares to 54 high prices in the previous quarter and 5 high prices over the same period last year.
High prices occurred 13 times in New South Wales, 7 times in Queensland and 3 times in South Australia. Most of the high prices were forecast.
There were also 15 high frequency control ancillary service FCAS prices in Queensland during the quarter.
Common drivers across most of the high price periods include tight supply conditions driven by high demand due to usually warm spring weather, planned network outages, significant baseload outages and low renewable generation.
Today’s report follows the release of the AER’s latest Wholesale markets quarterly report for October to December 2024.
The high prices and FCAS events in October, November and December 2024 included:
- 10 October in Queensland FCAS event
- 11 October in Queensland FCAS event
- 22 October in South Australia for one 30-minute period
- 23 October in South Australia for one 30-minute period
- 7 November:
- In New South Wales for six 30-minute periods
- In Queensland for five 30-minute periods
- 12 November in Queensland FCAS event
- 26 November in New South Wales for one 30-minute period
- 27 November in New South Wales for two 30-minute periods
- 2 December:
- In New South Wales for two 30-minute periods
- In Queensland for two 30-minute periods
- 3 December in New South Wales for one 30-minute period
- 5 December in South Australia for one 30-minute period
- 6 December in New South Wales for one 30-minute period
Background
The AER is required to report into significant price outcomes in the NEM.
30-minute wholesale electricity prices do not often reach $5,000 per MWh, but with a market price cap of $17,500 per MWh prices can occasionally exceed this reporting threshold. This reporting framework is intended to pick up these outlier events.
A high price may occur due to a variety of factors, including outages that adversely affect supply-demand conditions in the wholesale market.
The AER’s role in monitoring wholesale energy markets and reporting on high price events helps to enhance market transparency and compliance.
Our analysis provides a foundation to detect non-compliance, market irregularities, inefficiencies, and consumer harm. We draw on this work to advise stakeholders and market bodies on wholesale market issues.
The AER has published a Guideline for how we report into significant price outcomes.