AEMO and AER release Q2 2024 energy market reports
In late July, the Australian Energy Market Operator and Australian Energy Regulator released their respective reports on Australia’s wholesale electricity markets for Q2 2024. The National Electricity Market (NEM) quarterly average price of $133/MWh was the 2nd highest Q2 average on record, with prices higher in all NEM regions other than Queensland. Drivers of increased prices differed, with factors including network and plant outages, cold conditions, and low wind and hydro generation in the southern states resulting in more contribution from expensive thermal generation. Queensland, whose wind generation is less correlated with the rest of the NEM, bucked the trend and saw a 20% reduction in year-on-year prices, with an increase in the number of negative price intervals.
With the continued roll out of grid scale batteries throughout the NEM, there was double the generation from these assets during the morning and evening peaks. Gas supply dynamics continued to play an important role in electricity market prices, with low production from the southern Longford Gas Field resulting in more gas being shipped south from Queensland and greater utilisation of storage at Iona to meet increased gas fired generation. The full reports can be accessed from AEMO and the AER.
Renewables output hits record high, with strong pipeline of projects set to roll out in the coming year
As reported by NEM data provider, GPE NEMLog, the output of wind and solar in the NEM hit a record high of 11,315MW on July 8, beating the record held for almost a year. This level equated to renewables supplying 61.8% of NEM wide generation. This is a significant bounce back from lows seen in early June, which at one point saw renewables contribute just 7.66% of total generation, the lowest share since June 2020. The June low point was due in large part to the wind drought that has impacted the southern NEM states over Q2 2024, which appears to be easing as we move deeper into Q3.
Positive generation records such as these can be expected to be broken at a faster pace over the coming years with measures in the federal budget to increase the speed of approvals, and support from government schemes such as the NSW Long Term Service Agreements and Federal Government Capacity Investment Scheme. The pipeline of renewable projects due to come online has increased significantly over the past year, with the AEMO Q2 Quarterly Energy Dynamics Report recording that there are currently 9.2GW of projects progressing through registration or commissioning, compared to just 3.5GW at the same time last year.
Octopus Australia’s 1GWh Blackstone Battery receives planning approval
During the month, Octopus Australia announced a significant milestone for its Blackstone Battery, with the project receiving planning approval from the Ipswich City Council. The 1GWh battery located near Brisbane is one of Queensland’s largest battery storage projects and upon completion will store enough energy to power up to 70,000 homes per day.
Blackstone’s planning approval represents an integral step towards delivering Octopus’s strategy to provide the market with a firmed supply of renewable energy generation by developing large scale energy storage in strategic locations across the National Electricity Market.
Once constructed, the battery project will complement Octopus’s other wind and solar assets in Queensland, including the operational Dulacca Wind Farm and the Ardandra Battery and Solar Farm currently in development. This integration will allow Octopus to shift generation between its assets, optimising supply, and mitigating intermittency.
