Australian Energy Market Operator’s (AEMO) latest Quarterly Energy Dynamics report for the June quarter reveals the continued growth in renewables and the important role of gas during winter conditions in the National Electricity Market (NEM).
Across the NEM, a warmer and sunnier start to the quarter, combined with more new renewable generation capacity, saw record Q2 generation output in wind (+31%), grid-scale solar (+17%), and rooftop solar (+15%).
New all-time 30-minute output records were also set, with wind generation reaching 9,472 megawatts (MW) on 25 June, up 13% on the previous high. Grid-scale battery discharge surged 119% to average 162 MW, driven by 3,116 MW/6,415 MWh of new battery capacity since the end of Q2 2024.
AEMO Executive General Manager Policy and Corporate Affairs Violette Mouchaileh said the continued investment in new wind and solar has lifted renewables’ share of generation from 32% to 38% year-on-year for the quarter.
“As the operator of the National Electricity Market, we’re seeing increasing renewable output as total electricity demand rises, alongside reduced supply from power stations during periods of high rooftop solar output,” Ms Mouchaileh said.
While April and May were relatively mild, isolated periods of cold and low wind conditions in June triggered spikes in heating demand and reduced wind generation. This led to a greater reliance on gas-fired generation and batteries to meet evening peak demand.
“Combined coal-fired power outages, low wind and high demand on several days in June required a greater reliance on gas-fired and battery generation during evening peaks,” Ms Mouchaileh said.
These factors contributed $32 per megawatt hour (MWh), or 23%, to the quarterly average of $140/ MWh, up from $133/MWh in Q2 2024.
Over the 12 months to June, 4.4 gigawatts (GW) of new generation and storage was added to the NEM, while 53 GW of projects remain in the connections pipeline, including 7 GW that is built and commissioning.
“As these projects enter the NEM, more capacity will be available to meet these isolated days of elevated peak demand, alongside coal outages and reduced wind output,” Ms Mouchaileh added.
“Ongoing investment in gas-fired power remains critical to generate energy during these periods of low wind or solar, or when storage reserves are depleted, and to support growing demand as our power systems transition,” she said.
In the East Coast Gas Market, demand fell 3% from Q2 2024 levels across all sectors. Market demand declined by 7 petajoules (PJ), while gas-fired generation dropped 3 PJ and Queensland liquified natural gas exports were 2 PJ lower.
Although Queensland LNG export projects reduced supply to the domestic market, Victorian production rose. The lower demand and increased supply led to the Iona Underground Gas Storage inventory finishing the quarter 2.2 PJ higher than the same period last year.
East coast gas prices eased, averaging $12.36 per gigajoule (GJ) compared to $13.66/GJ in Q2 2024.
Ms Mouchaileh said, similar to the NEM, underlying demand and renewable contributions increased within Western Australia’s main power system, the South West Interconnected System (SWIS).
“Average total demand rose 8.6% compared to Q2 2024, driven by economic activity, cooler temperatures and battery charging, which was partially offset by growing rooftop solar output,” Ms Mouchaileh said.
“New records were set for both average renewable contribution (35.15%) and peak renewable contribution (78.8%) for the quarter. By individual technologies, gas (32.1%) and coal (31.9%) remained the largest contributors to the fuel mix.
“Grid-scale battery discharge rose by 44.1 MW (+469%) on average, mostly during the morning and evening peaks, supported by 725 MW/2,900 MWh capacity added in the past year,” she said.
Average energy prices in the WEM for Q2 rose $11.67/MWh to $90.46/MWh, mainly due to the higher operational demand. However, frequency co-optimised essential system service (FCESS) costs dropped by 72% as a result of changes to the framework.
In Western Australia’s domestic gas market, consumption fell 4.6% to 94.3 PJ, while production dipped marginally to 1.5 PJ.
ENDS