The National Electricity Market
Wholesale electricity prices in October had some large percentage increases but off a very low base from last month. Over the month on average TAS prices increased the most – 121% to $50/MWh. QLD and NSW also had large increases, up 43% and 33% respectively to $71 and $77. VIC was also up 17% at $20. SA bucked the trend falling 56% to $35/MWh.
Electricity Generation Mix
Total grid-scale generation for October decreased by 5.1% from September levels – given that there is 1 more day in October, this corresponds to another large drop in operational demand due to warmer weather and the pick-up of roof-top solar output.
Solar and Hydro generation increased significantly while Wind was 20% down on last month. Gas generation fell by 10% while Coal was also down 5% compared to September.
Gas Generation
Gas generation decreased in October - down 10% from September levels. Compared to 12 months ago gas generation was 7% less than it was in October 2023.
By State, gas generation changes were mainly negative. The biggest falls were NSW, which decreased 37%, while SA dropped 13%. VIC had a 6% decline, while QLD fell 4%. TAS gas generation gained 116% on very small numbers.
Hydro Generation
Hydro generation increased 9% in October compared to September levels, near the average levels seen in the last 9-years, for this time of year, as shown below.
Storage in Hydro Tasmania’s lakes was flat through October. Storage ended the month at 6,879GWh (48% full), a decrease of 15GWh over the month. This is now close to last year’s level and above the average level seen in the last 9 years, as shown in the following chart.
Snowy Hydro’s storage was also flat during October. Snowy finished the month 50% of full (2,673Gl) – a 1% increase over the month. Levels remain close to the 9-year average for this time of year as shown in the following chart.
Climate outlook overview (from BOM)
The long-range forecast for November to January shows:
- above average rainfall is likely across large areas of eastern Australia and parts of the interior
- warmer than average days and nights are likely to very likely across most of Australia
- unusually high minimum temperature is very likely for much of northern and eastern Australia.
New Renewable Generation (Excluding Hydro)
Total renewable generation (wind and solar, including roof-top solar) in October set a new record level at 6,745GWh – 5% up on September and 4% more than the same month last year. Wind generation actually decreased 19% from last month’s high level and was down 5% compared to October last year. Utility Scale Solar generation was up 27% from September levels and up 7% over the same month last year. There was significant curtailment of both wind and utility scale solar generation as wholesale prices dived into negative territory for large parts of the month.
The following chart shows the monthly energy produced for each of these renewable types since 2017.
The Electricity Futures Market
Futures prices increased through October in all States, across every calendar year. Note CAL28 started being traded at the beginning of Oct.
In NSW CAL25 was up 4% at $121/MWh, CAL26 was up 4% also at $121, while CAL27 closed also at $121 - up 2.5% over the month. CAL28 settled at $120.
Calendar Year Contracts for New South Wales
QLD prices for CY 2025 were up 5% at $108. CAL26 increased 4% closing at $102, while CAL27 finished up 4% at $96. CAL28 traded at $95.
Calendar Year Contracts for Queensland
VIC futures prices for CAL25 were flat at $73, CAL26 was up 1.4% at $71, while CAL27 was up 3% at $68. CAL28 traded at $76.
Calendar Year Contracts for Victoria
SA has less liquidity in the futures markets than other States, so changes tend to be lumpier and less a true reflection of the underlying market. For completeness we have included the graph below.
The Gas Market
Internationally, LNG netback prices ended the month at $16.49/GJ – down 5% from last month. Forecast prices for 2024 were flat at $15.08. Forecast prices for 2025 were up 4% at $17.42/GJ. (Note that netback prices are indicative of international prices – they are produced by the ACCC and quoted in Australian dollars. They are net of the estimated costs to convert from pipeline gas in Australia to LNG, hence the term “netback”)
Domestic spot gas prices increased through October. The following graph shows the 30-day rolling average price at Wallumbilla gas supply hub – ending the month at $13/GJ, an 8% increase from September levels. This is still well below the LNG netback price. Prices are 36% above what they were the same time last year.
Gas storage at the key Iona storage facility rose slowly through October. Storage increased to 13.4PJ – an 8% increase over the month. Storage is still below the average levels we have seen at this time of year for the past 8 years.
LPG is an important fuel for many large energy users, particularly in areas where reticulated natural gas is not available. The contract price of LPG is typically set by international benchmarks such as the Saudi Aramco LPG – normally quoted in US$ per metric tonne.
The following graph shows the Saudi Aramco LPG pricing for the last 3.5 years as well as forecast pricing for the year ahead. There has been a decrease in futures pricing over the last month.
The other main contributing factor to LPG prices in Australia is the exchange rate against the USD. The exchange rate fell through the month ending just below 0.66. This would tend to push up LPG prices when quoted in AUD.
The Coal Market
The global energy crisis has been as much about coal as it has gas. The war in the Ukraine has driven energy prices, including coal, up. Prices in October were largely flat, ending the month at US$142/T – a 2% decrease on the September close. These prices are finally returning to levels close to what we expect to see as shown in the following graph of prices over the last 10 years.
High international coal prices continue to be an important driver of electricity prices especially in the States most reliant on black coal generation – ie QLD and NSW.
Environmental Certificates
The following graph shows environmental certificate spot prices over the last 4 years.
After recent large falls, ESC’s bounced back – up 25% at $16.5 per certificate. ACCUs also increased, up 6% to $38.5. Spot LGCs fell 11% to $36.75 while VEECs also dropped 3% to $105. STCs were unchanged at $39.9.
Future dated LGCs had significant reductions in all years through October. CAL24 was down 12% at $36.75, CAL25 down 11% at $37, while CAL26 decreased by 11% to $28.55. CAL27 decreased by 9% to $24.28 while CAL28 also fell 18% to $21.
About this Report
This energy market summary report provides information on wholesale price trends for all regions within the National Electricity Market (NEM) and environmental scheme certificates.
Please note that all electricity prices are presented as a $ per MWh price and all certificate prices as a $ per certificate price.
All NEM spot prices are published by the Australian Energy Market Operator (AEMO). Futures contract prices are sourced from ASX.
Further information can be found at the locations noted below.
- NEM Spot market – AEMO publishes a range of detailed informationwhich can be found here: https://aemo.com.au/Electricity/National-Electricity-Market-NEM/Data-dashboard
- Weather and Climate data – The Bureau of Meteorology publishes a range of weather related information which can be found here: http://www.bom.gov.au/climate/
Disclaimer
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