Energy diversity shifting prices

Much of the discussion around wholesale energy prices has centred on the dominance of coal and gas generators at peak times, but two new reports show the anomalies that are happening as the transition gains steam. And how renewables are capable of driving wholesale prices down.

Large scale solar and wind generation set the price more often across all NEM regions in the first quarter of 2025 (compared with Q1 2024), according to the Australian Energy Regulator’s latest wholesale markets report. There were significant increases in:

• South Australia (21% to 27%)
• Queensland (7% to 17%)
• NSW (6% to 14%)

And, in another nod to Australia’s big battery boom, batteries set the price more often across all regions. A record volume of industrial-scale batteries entered in the quarter, and the amount of electricity discharged from batteries rose 85.5% compared to this time last year, the AER said.

Wholesale prices in the NEM over summer were lower in northern regions and higher in southern regions in the quarter, thanks to fewer price spikes in NSW and Queensland, hot weather in SA and Victoria, and hydro generators in Tasmania dealing with dry conditions.

AEMO's latest Quarterly Dynamics report showed Victoria and South Australia recorded the lowest quarterly average wholesale spot prices across the NEM in the quarter.

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​Average wholesale electricity spot price by region

Watch the price setters

Black and brown coal has been setting the price far less across all regions, but particularly in Victoria and South Australia.

Higher amounts of wind in Victoria and South Australia also reduced the number of times dispatchable generators set the price outside of solar hours compared with the same time in the previous year, the AER said.

Negative prices in force

As renewables continue to join the grid and the market does what a market does, negative prices are becoming a greater feature of the NEM. Q1 saw 3,598 negative price 30-minute periods, 834 more compared with the same period last year, the AER said.

And in this quarter there were fewer high price events, meaning for Victoria, the impact of negative prices on average quarterly prices outweighed the impact of high price events.

Energy mix

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The NEM last week (29 April-5 May) vs. same week in 2024. With thanks to OnlyFacts​

• Coal (Black): 41.1% (–2.6%)
• Coal (Brown): 14.0% (–0.1%)
• Solar (Rooftop): 11.6% (+3.1%)
• Wind: 17.6% (+2.3%)
• Solar (Utility): 8.2% (+2.2%)
• Hydro: 5.3% (–2.1%)
• Gas: 3.4% (–1.9%)
• Bioenergy: –0.0% (–0.2%)

The SWIS last week (29 April - 5 May) vs. same week in 2024

• Coal (Black): 37.2% (+4.1%)
• Gas: 32.1% (+2.8%)
• Solar (Rooftop): 16.5% (+2.6%)
• Wind: 12.4% (–9.6%)
• Solar (Utility): 0.9% (–0.2%)
• Bioenergy: 0.4% (–0.0%)
• Hydro: 0.0% (0.0%)

Monthly emissions intensity this month so far vs. May 2024

• NEM: 538.0 kgCO₂e/MWh so far this month (-4.3%)
• SWIS: 525.8 kgCO₂e/MWh so far this month (+8.0%)

Data news

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​AEMO’s latest Quarterly Energy Dynamics report for Q1 also found

• Renewables provided 43% of the NEM supply mix, up from 39% in Q1 2024, and drove quarterly NEM total emissions to new Q1 lows
• Similar trends were seen in the WEM, with renewable contributions reaching a new Q1 high
• Grid-scale solar generation achieved a new all-time high, increasing by 10% year-on-year. Wind generation saw an 18% rise, reaching a new Q1 high — both increases were driven primarily by growth in availability at new and commissioning facilities
• In the east coast gas market, wholesale gas prices rose from $11.60 per gigajoule (GJ) in Q1 2024 to a new Q1 record of $13.26/GJ.
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OnlyFacts released a dashboard, including electricity companies, that allows people to see how big carbon emitters are using Safeguard Mechanism credits.

The IEA delivered the annual update of its carbon capture, utilisation, and storage database, showing a modest change with just over 50 million tonnes of CO2 capture and storage capacity in operation.

SolarQuotes estimated the discount and end cost under the coming home battery rebate policy for this year’s best battery brands (as voted by installers) in Australia.