Summary provided by SEMMA member Leading Edge Energy
Wholesale electricity futures and spot prices have plummeted since gas and coal price capping legislation was passed in the Federal and state parliaments of NSW and QLD. However, on average, they are still double what they were this time last year.
Following Government budget projections that electricity and gas prices were expected to shoot up by 56 and 40 percent respectively, the Federal Government put a $12/Gigajoule cap on domestic uncontracted gas for 12 months.
The Federal Government hit back at criticism by gas producers, saying that gas was fetching similar prices last year and producers were still reaping handsome profits.
A multitude of battery storage projects has also been announced around the country. Despite the huge amount of new coverage they get, it is worth noting that fast-discharge batteries only contribute to 0.09% of generation across the NEM. For comparison, pumped hydro contributes 6% and gas 3%.
VICTORIAN MOVEMENT SUMMARY
- 2023 started the month at $129/MWh, prices tumbled to $109/MWh and then dropped again to $89/MWh to close off the month.
- At $89/MWh 2023 futures are $99/MWh cheaper than at the peak of the crisis in October when they tipped $188 but still significantly more expensive than at the end of December 2021 when they were $50/MWh.
- 2024 contracts started the month at $96, dropping to $79 by the middle of December and closing off the year at $68.
- 2025 contracts started the month at $94 dropping to $69, and closing off the month at 64/MWh.
VICTORIAN COMMENTARY
- The spot market dropped by almost half, with the volume-weighted average price (VWAP) coming in at $31 / MWh compared to $59/ MWh the previous month.
- The spot price was less volatile in Victoria compared to the previous month, spanning between -$937 and a high of $316. There were five instances where negative pricing was between -$400 and -$937.
- Coal generated 60% of the energy mix, up 3% from the previous month. Renewables supplied the state with 39 % of its power, down from 42.5%. Reliance on gas was very low at 0.5% of supply.
- AGL’s Loy Yang A returned to service in the fourth week of October after months of being offline and the uptick in coal-fired energy is attributed to this.
- A new minimum operational demand record of 2,195 MW was set on Monday 19 December at 1 pm, dropping 3.9% from the previous set in October 2022 (2,285 MW). At the time, rooftop solar contributed 55% of underlying demand.
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Concerned about energy prices? SEMMA members have access to a free, no-obligation evaluation as part of your membership to assess whether your organisations’ energy rates are competitive or could be improved – whether you are currently in contract or not.
Fill in our online Energy Evaluation Form to find out if you can make any savings on your energy bill, or directly contact our partner Ewen Beard.
Ewen Beard | Sales Manager, Leading Edge Energye.beard@leadingedgeenergy.com.au | 0481 345 181
