Analysis

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Some highs and lows: Investor sentiment

Some of the challenges being thrown up by the energy transition, in particular around approvals, capacity and supply chain constraints, skilled labour shortages and government interventions are being reflected in the latest assessment of investor sentiment towards the sector. We take a look.

BY Carl Kitchen Nov 23 2023

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Energy Dynamics Report - A Tale of Minimum Operational Demand and Wholesale Price declines

The third quarter saw significant price declines compared with the corresponding quarter in 2022 right across the NEM. At the same time with increased output from solar and wind generation inin Queensland’s case, minimum operational demand records were set or equaled in every region. The quarter also saw the highest-ever level of negative price intervals with all regions showing an increase. We dive in to the pricing and operational demand detail of AEMO’s Q3 Quarterly Energy Dynamics Report.

BY Australian Energy Council Nov 09 2023

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NEM generation profile 2022-23

The AER’s 2023 State of the Energy Market highlights the generation mix across the NEM as well as emerging trends. We take a look at what key developments occurred in the generation mix and how they impacted price trends throughout the 2022-23 financial year.

BY Australian Energy Council Oct 12 2023

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Market assessment highlights evolving market

In late July, the Australian Energy Market Operator published their analysis of the wholesale market for the second quarter of this year. While the media headlines trumpeted price rises of 31 per cent, the report itself paints a much more restrained picture of the state of the market. As the AEC pointed out at the time, the report illustrates a stabilisation when compared with this time last year, with the industry in a much better position heading into winter than it was in 2022.

BY Australian Energy Council Aug 10 2023

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GenCost verdict: Onshore wind and solar remain lowest cost generation

The latest GenCost report has again highlighted that solar and onshore wind remain the lowest cost new build generation available. This remains the case even when integration costs are factored in. The report also quantifies the cost of global supply chain constraints which have impacted the raw material costs for manufacturing, as well as the transport costs involved in getting new generation installed. Those constraints have led to an estimated average 20 per cent increase in technology costs compared to a year ago. Read more to see the forecast costs of different generation technologies.

BY Carl Kitchen Jul 27 2023

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Reports highlight ongoing challenge of transition

Amidst all the discussion of the energy transition two new reports looking at energy use and options for the energy transition have highlighted the continued major challenge to reduce overall carbon emissions. We take a look at the '2023 statistical review of world energy' and the ‘How to make net zero happen’ reports side by side to provide a picture of where energy consumption has been, and where it may be going in the future and the implications for the energy sector.

BY Australian Energy Council Jul 20 2023

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Rebirthing coal power stations into synchronous condensers

As the power system transitions, the Essential System Services previously supplied by fossil fuelled generators must be replaced. This requires a widespread rollout of Synchronous Condensers (SCs). ARENA has supported and published a report into an unconventional but promising solution, the conversion of fossil fuelled generators into SCs, either whilst the generator is still operational or upon its closure. The report is very timely because the queue for new SCs requires us to commit to either them, or plant conversions, long before these power stations close. We explain what SCs are, what they do, and the options discussed in the report.

BY Ben Skinner Jul 20 2023

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Reliability standard ain’t broke

Since market start the NEM has used a single and simple outcome metric for its reliability standard: “Unserved Energy” (USE). Essentially, we target an average of no more than 10.5 minutes off supply per customer per year from rotational load-shedding. In response to a Reliability Panel Review, the Australian Energy Council has published a report by Endgame Economics that theoretically contemplates the appropriateness of the existing standard in the transitioning power system and concludes that the existing simple USE output form approach remains the best approach for the future power system, just as it is in the current power system. Read more.

BY Ben Skinner Jul 13 2023

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Queensland Energy and Jobs Plan – the update

Last September the Queensland Government announced the “Energy and Jobs Plan”, a remarkably comprehensive central plan to revolutionise the Queensland electricity sector, phasing out the currently dominant coal sector over a decade and replacing it with renewables and storage. The plan also called for a transmission “supergrid”, three Renewable Energy Zones (REZs), and two enormous pumped hydro schemes. The government has progressed the plan by announcing new renewable energy targets and publishing draft legislation to enact these and the plan.

BY Ben Skinner Jun 22 2023

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OSM RIP

After three years of work on the Operational Security Mechanism (OSM) rule change and reaching a Draft Determination last October, the Australian Energy Market Commission (AEMC) changed course last week with a guidance note that appears to call the whole thing off. The OSM was to be a mechanism by which the market operator could start assets that provide Essential System Services (ESS) to secure the power system. An automated tool that was meant to make it simple. So, what’s changed and where we are now? we take a look.

BY Ben Skinner Jun 01 2023

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Bittersweet farewell to Liddell

Last week was another significant step along the path to a lower emissions power grid with the closure of the Liddell Power Station after 52 years of service. The length of service is quite an achievement - it’s estimated only around 1 per cent of thermal plants globally run beyond 50 years. The closure of the final unit was described as “bittersweet” while the lead up to the end of operations was heralded by commentary on perils to supply reliability and the potential for higher wholesale prices. But it wasn’t the first time it made the headlines in NSW.

BY Carl Kitchen May 04 2023

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Energy Outlook points to exponential electricity growth

Increasing levels of electrification and rising living standards globally will see an exponential growth in the demand for electricity, according to projections in BP’s latest energy assessment. BP’s Energy Outlook is updated annually to provide useful insights in the energy transition globally. It considers three scenarios which are designed to consider the full range of potential outcomes into the future and resulting carbon impacts. We take a look at what this latest review finds.

BY Mitchell Cutting Apr 27 2023

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High prices cured high prices

Coal and gas prices have been at the forefront of government and policy makers minds since last year and concerns about their impact on Australian energy prices ultimately led to Federal Government price caps. Last year we identified how energy markets were beginning to correct even prior to the intervention. We take another close look at the price trends internationally and locally to see how markets have continued to respond to what were extraordinary challenges.

BY Peter Brook Feb 23 2023

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What a difference a year makes

It has been an extraordinary year in energy (some might say unprecedented). While 12 months ago the ACCC was announcing the lowest electricity prices for 8 years, now price caps on gas and black coal are expected in response to concerns about wholesale price surges and their impact on end user bills. Aside from these price challenges, we saw the NEM suspended for the first time, as well as major state-based energy plans unveiled, including revival of Victoria’s State Electricity Commission, and announcements of more early coal closures. We take a brief look back as the year draws to a close and consider what 2023 might bring.

BY Sarah McNamara Dec 08 2022

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Navigating Australia’s energy transformation

Recent state-based energy plans and announcements of the acceleration of some coal plant closures has again raised questions of how best to manage the energy transition for communities and workers. There are an increasing number of case studies, both internationally and locally, that can help illustrate the options towards achieving a just transition. To take advantage of that work the Australian Energy Council commissioned consulting and advisory firm, Strategen, to undertake a wide-ranging review of overseas and Australian experience and distil relevant insights for Australia. We take a look at the resulting report.

BY Australian Energy Council Dec 01 2022

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Privatisation claims: Do they add up?

The Andrews Labor Government made a partial re-entry of government into electricity generation a major part of its re-election pitch. A claimed $23 billion in profits earned by Victorian generators since privatisation was also frequently cited as part of this. Does it add up and where did that number come from?

BY Peter Brook Dec 01 2022

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Deep Dive: 2022 Victorian Election Commitments

Recent data shows that energy is an issue that more and more voters are conscious of as they consider which politicians are best to lead us. The latest True Issues Survey conducted by JWS Research and published in the Australian Financial Review shows that 39% of people believe that energy is one of the most important issue the government should focus on, compared with 20% in March. This movement comes against a background of an energy crisis in June precipitating higher wholesale energy prices and the effects beginning to filter through to consumer bills.

BY Australian Energy Council Nov 24 2022

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Have high prices already cured high prices?

A huge challenge for governments considering intervention in wholesale markets is that consumer prices lag behind wholesale spot and forward prices. Customers are only just starting to feel the effects of events that happened some time ago. But after a year of relentless rises in wholesale prices, there may now be some good news. Gas, coal and electricity prices across the world, and in Australia, have taken a major correction downwards in the last two months from historically high levels, a trend that could well continue.

BY Ben Skinner Nov 17 2022

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A view from the Spree: Australian Energy Delegation to Berlin

While Australia’s east coast energy market winter can justifiably be described as an unprecedented crisis, Germany puts this into perspective as it is facing something much bigger and longer. Germany is also tackling decarbonisation of its energy sector and economy. The Australian Energy Council’s General Manager Policy and Research, Ben Skinner, recently participated in a delegation to Berlin as part of the Australia – Germany Energy Partnership. It provided an opportunity to learn about and from Germany’s decarbonisation efforts. Here we present some reflections on Germany on both the energy crisis and its long-term direction.

BY Ben Skinner Oct 06 2022

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Qld Energy and Jobs Plan: Energiewende down under

Queensland, with its relatively young and mostly government-owned coal fleet, has often been criticised by environmental advocates for not engaging honestly with its future in a carbon-constrained world. That all changed last Wednesday when the Queensland Government released, with great fanfare, an audacious plan to retire and repurpose all its coal plants and commit to a remarkably large government build of transmission and pumped storage, plus a host of other matters. Here we take a look at the coal retirements, pumped storage and renewable arrangements.

BY Ben Skinner Oct 06 2022

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