National Electricity Market hits new demand and renewable energy records in December quarter

30/01/2025
4 min

AEMO has released its Quarterly Energy Dynamics report for Q4 2024, revealing record-breaking demand levels in the National Electricity Market (NEM) and a surge in renewable energy contributions, highlighting the transformation of Australia’s energy system.

Driven by higher temperatures and a growing electrification shift from gas to electricity, the NEM experienced a new December quarter maximum demand record of 33,716 megawatts (MW) and an average quarterly total demand record of 23,737 MW, a 2.4% year-on-year increase.

At the same time, rooftop solar and grid-scale solar reached new output records, increasing by 18% and 9%, respectively. This surge led to minimum demand records across the NEM and in Queensland, New South Wales, South Australia, and Tasmania.

AEMO Executive General Manager - Reform Delivery, Violette Mouchaileh, said: “The rise in rooftop solar output, coupled with record low coal-generation availability, resulted in coal-fired generation contributing less than 50% of the NEM’s total generation for the first time.”

“Renewable energy supplied a record 46% of the market’s electricity, peaking at 75.6% for a period on 6 November, driving emissions to record low levels,” she said.

Wholesale electricity prices averaged $88 per megawatt hour (MWh) in Q4 2024, representing an 83% increase compared to a very mild Q4 2023, but 26% lower than the previous quarter average of $119/MWh.

New South Wales and Queensland experienced record Q4 wholesale prices of $143/MWh and $127/MWh, respectively, due to high demand, coal generation unavailability, and transmission constraints limiting northern flow of lower-cost energy.

Victoria recorded the lowest average price at $45/MWh, followed by South Australia at $52/MWh and Tasmania at $74/MWh.

“Recent operating conditions highlight the role new transmission projects underway – such as VNI West, Project EnergyConnect and HumeLink – will play in sharing the lowest-cost energy throughout the NEM,” Ms Mouchaileh said.

The quarter also saw record-high instances of negative prices in the NEM, with negative price events occurring 23.1% of the time, an increase from the previous high of 19.9% recorded in Q4 2023.

Regional records for negative price frequencies were also set in New South Wales, Victoria and South Australia, at 13.3%, 34.3%, and 38%, respectively.

In Western Australia, coal generation dropped by 19.5% due to reduced coal plant availability. This shortfall was offset by increases in rooftop solar (20.3%), gas (14.4%), and battery contributions (1,400%). Average energy prices remained relatively unchanged from the previous quarter at $79.93/MWh.

“Increased battery storage in Western Australia helped the state hit a new quarterly average renewable contribution record of 46.4% and a renewable energy peak of 85.1%,” Ms Mouchaileh said.

In Western Australia’s domestic gas market, production dipped 1% to 104.3 petajoules (PJ) and consumption reduced 2.6% to 93.9 PJ compared to Q4 2023.

Meanwhile, east coast wholesale gas prices rose to $13.60/GJ, driven by record Queensland liquefied natural gas (LNG) exports and increased gas-fired electricity generation.

Increases in Victorian production, with the Otway Gas Plant continuing to see an increase in supply in Q4 (+6.1 PJ) and Longford Q4 gas production increasing for the first time since Q4 2022 (+3.7 PJ), were offset by reduced supply from projects associated with Queensland LNG exports.

ENDS

X
Cookies help us improve your website experience.
By using our website, you agree to our use of cookies.
Confirm