Colder temperatures and reduced rainfall across southern regions of the National Electricity Market during the June quarter led to decreases in electricity supplied from renewable sources.
The drop saw wind generation down 20 per cent and hydropower down 18 per cent compared to the same period last year, according to the latest Quarterly Energy Dynamics report released by AEMO.
The decreased renewable output was offset by increased generation from gas-fired power stations (+16 per cent) and black coal plants (+7 per cent), particularly in Queensland where coal plant availability improved.
AEMO CEO Daniel Westerman said the wintry conditions drove record total electricity demand for a June quarter as cold snaps gripped the east coast, especially in Victoria.
“Extended periods of low wind have led to reduced wind generation output which was down 20 per cent from last winter to a quarterly average of 2657 MW, with wind availability down to their lowest levels since Q2 2017,” he stated.
“These market conditions highlight the important role that batteries, pumped hydro and flexible gas generation will play as renewable generation becomes more dominant in Australia’s electricity grids.”
Westerman highlighted the important backup role flexible gas generation, batteries, and pumped hydro storage will play as renewables become a bigger part of the energy mix.
“The role of batteries in supporting morning and evening demand peaks became more prominent, with average generation in those periods more than doubling since last year, reflecting the significant increase in battery capacity,” he said.
According to AEMO, average wholesale electricity prices jumped 23 per cent year-on-year to $133 per megawatt hour across the National Electricity Market, driven by the higher costs from increased gas and coal generation replacing lower renewable output.
Prices rose most sharply in NSW, South Australia, Tasmania and Victoria, while Queensland spot prices fell due to improved black coal availability.
The east coast wholesale gas market saw prices averaging $13.66 per gigajoule (GJ) for the quarter, down from $14.21/GJ in Q2 2023, despite an 18 per cent rise in gas-fired generation compared to last year.
AEMO flagged potential gas supply risks due to the rapid decline of the Iona underground gas storage inventory.
In contrast, warmer weather in Western Australia allowed its main grid to set a new Q2 renewable energy record of 30.8 per cent, reducing demand for gas power.
However, outages at some coal and gas plants offset lower operational demand, keeping prices flat versus the prior quarter.
Domestic gas production in WA rose 7.8 per cent on increased output from the Karratha Gas Plant.
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