This report is the third and final part of our Annual Report series covering generation, emissions, demand, weather, and reserve levels. There are 7 components of the report providing a range of insights and conclusions.
This second part of our Annual Market Report focuses on the Financial aspects of the market by addressing the performance of financial derivatives, followed by an analysis of environmental certificate prices.
The Australian energy market continued to recover during 2023 from the extraordinary global energy crisis it faced in 2022. Electricity and gas spot prices softened but remained high compared to pre-2022 levels.
448MW of new generation capacity in November pushed the total for 2023 higher than recent years, in a record year for battery storage totalling 847MW. The weighted premium for solar generation improved as daytime prices climbed. This month we also take a look at battery performance across the NEM.
Electricity spot prices rose in November, as lower levels of VRE generation was replaced by gas-powered generation, although the increase in GPG did not prevent gas spot prices from softening from around $12/GJ to $9/GJ. Highlights from energy market news feature significant updates for the market.
November 2023 was the second most heavily traded month in history as the market softened throughout the month. Spot prices for Q4-23 continue to fail to deliver to previous market expectations.
Electricity spot prices continued to fall well short of market expectations in October, driving down the Q4-23 forward price. The sentiment of the market outlook is mixed with some Regions strengthening and others softening.
Could this be the calm before the storm? Low demand and high renewable generation crushed electricity spot prices during October, but how long can it last? El NiƱo continues to threaten a hot and dry summer with AEMO's Summer Outlook painting the picture of a market on a knife's edge.
Our Monthly Report continues with Spot Market prices where a mild September and high VRE generation brought softening electricity prices, while gas spot prices have fallen to pre-2022 price levels due to soft demand, high production and storage levels, price caps and softer international prices.
Continuing low spot prices impacted forward expectations despite the warnings of bushfires, a hot summer and possible shortages. Last October the forward market peaked, but this October is set for a downhill run as Spring conditions of plenty of wind and increasing sunshine prevail.
The electricity market bucked the trend in August with stronger spot prices and bullish activity in the electricity forward market. Revised ESOO reliability outlooks have seized the market's attention and turned attention to generator and State Government negotiations around retirement dates.