Post: Surging renewables installations sees record supply to Australia’s electricity grid

Surging renewables installations sees record supply to Australia’s electricity grid

A shift in the energy landscape, has meant wholesale electricity prices averaged $63/MWh in the September quarter – down 41% from the June quarter ($108/MWh) and 71% ($216/MWh) from Q3 2022.

In its latest Quarterly Energy Dynamics report, published on 23 October, AEMO noted that, in the quarter the composition of electricity supply by fuel type showed renewables (including wind, grid-scale and rooftop solar, hydro, and other sources) contributing 38.9% of the total supply, marking a 4.6% increase. Meanwhile, the share of black coal declined by 3.4%. Brown coal’s market share, on the other hand, increased by 1%, mainly due to fewer unplanned outages.

This record renewable generation output significantly contributed to reducing wholesale electricity prices, increasing occurrences of zero or negative wholesale prices (19%), and reducing total emissions by 11% compared to the previous September quarter. Renewable energy also supplied a record 70% of total energy used over a half-hour period, with rooftop solar accounting for 39%.

At the end of Q3 2023, 33GW of new capacity was progressing through the connection process from application to commissioning, with one-third of this capacity in new applications submitted during the last six months.

Above average temperatures across Australia decreased underlying demand in most National Electricity Market (NEM) regions in Q3 2023. Combined with high levels of distributed photovoltaic output this drove average NEM operational demand to a new Q3 low of 21,270MW.

Numerous minimum demand records were set this quarter. The NEM as a whole reached an all-time minimum demand of 11,393MW on Sunday 17 September, 499MW below the previous record in Q4 2022. New South Wales, Victoria and South Australia all saw record minimum operational demands this quarter, and Queensland recorded its lowest operational demand since 2002. South Australia’s minimum operational demand was 21MW in the half-hour ending 1330 hrs on 16 September, when distributed PV output represented 98.5% of underlying demand.

Regionally, South Australia experienced the highest quarterly average price at $92/MWh, followed by New South Wales ($81/MWh), Queensland ($65/MWh), Victoria ($49/MWh), and Tasmania ($29/MWh). In the Western Australian Wholesale Electricity Market (WEM), the quarterly weighted average Balancing Price reached $99/MWh, the highest for a Q3 and a 27% increase from Q3 2022. However, it was lower than the Q2 record. The weighted average Short-Term Electricity Market price for Q2 2023 was $91/MWh, marking a 33% increase compared to Q3 2022.