Feb-21 Energy Market Report

NEM capacity grew by 1,678MW in August. With temperatures rising, energy demand dipped, while consistent strong winds boosted supply, resulting in large curtailments and declined Generator-Weighted Average prices in most NEM regions. TAS still depended on VIC energy exports due to hydro shortage.

Cold weather and low VRE generation contributed to extreme prices early in August. This was followed by unusually warm temperatures, softening demand, falling gas consumption and softer spot prices driven by record levels of renewable generation.

It has been a wild ride this winter in the forward market driven by turbulences in the spot market, structural changes in spot outcomes, prevailing weather conditions and challenges facing the market.