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June 2023 Energy Market Insights

Aerial view power plant, Combined cycle power plant electricity generating station industry.

June 2023

There have been relatively good outcomes in the electricity and gas markets this month. Contract prices fell slightly over the month in NSW, VIC and SA while QLD remained relatively steady. Average spot prices for June were significantly lower than May which contributed to the decrease in contract prices. Gas prices also decreased and remained below $15/GJ on the east coast.

There has been a lot of discussion about the energy transition this month. Multiple renewable energy output records were broken as new projects come online, however there are increasing concerns about delays, cost blowouts, transmissions and lower than required investment in new generation.

Onto the beginning of July, in the last few days the market has dropped significantly following high renewable energy generation, a further fall in gas prices on the back of more availability and mild winter temperatures which are expected to continue with the declaration of El Nino weather pattern.

Recent Highlights

  • Landowners have been pushing NSW power network TransGrid to bury parts of the proposed transmission link to Snowy 2.0 underground. A NSW government enquiry was called this month to investigate the benefits and costs of undergrounding. AFR
    • Compensation for farmers who host transmission lines on their land have also been doubled to $400,000 per kilometre. AFR
  • Energy experts have warned that higher power prices could be the new normal for coming years due to the upfront investment required for the energy transition. ABC

Renewable Energy News

  • The head of the Australian Energy Market Operator Daniel Westerman says renewable energy investment is not moving fast enough, with no new projects reaching financial close in Q1 2023. RenewEconomy
  • New wind energy and combined wind and solar output records were broken multiple times over the month.
    • Wind production in the NEM reached a new high on Sunday 25th June at 7,414 MW, beating the record set the day before. WattClarity
    • Combined wind and solar generation reached 10,716 MW also on Sunday 25th June. RenewEconomy
  • The 150 MW Hazelwood battery was official commissioned this month becoming the first big battery on the site of an old coal generator. RenewEconomy

Market Reports

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