May began with some volatility in the market and there were a number of price spikes throughout the month that may be attributed (but not solely) to the closure of Liddell Power Station, along with other factors. Electricity Futures prices experienced some volatility but ended with prices similar to the start of the month in all states except SA which saw an increase, while average daily spot prices increased in NSW and QLD. Gas spot prices experienced a spike up to $23-30/GJ but have come back to levels at the start of the month, around $15/GJ, off the back of softening global LNG prices. It’s been a very busy month in energy news with the 2023-24 federal budget, price increases and volatility, and delayed return to service dates for Callide Power Station in QLD.
- The 2023-24 Federal Budget included a number of energy-related funding measures.
- $2 billion funding for green hydrogen to develop the industry over coming years. AFR
- Changes to the Petroleum Resource Rent Tax to cap tax deductions for LNG projects, expected to deliver an additional $2.4 billion to the budget over 4 years. AFR
- Establishing a net zero authority to help transition workers in heavy-emitting industries. ABC
- $1.5 billion package to provide bill relief to vulnerable individuals and small businesses.
- Low-interest loans for households to implement energy efficiency measures.
- Return to service dates for Callide units have been delayed yet again, with the full operation now expected in February 2024 for C3 unit and July 2024 for C4 unit. WattClarity
- This means that the C4 unit will have been offline for over 3 years, which is likely the longest outage in the history of the NEM.
- The Default Market Offer (the benchmark electricity price for residential and small business customers) has been increased by between 20 and 25% for the next financial year. ABC
- This follows increases of 8-14% above inflation last year.
- There have been multiple spikes of volatility in NSW and Queensland throughout the month as the states experience their coldest May minimum temperatures on record. WattClarity
- Two coal mines have been cancelled after they failed to provide adequate information about their environmental impact after many years of requests. AFR
Renewable Energy News
- Delays and cost blowouts have been revealed for NSW Renewable Energy Zones, due to increased capacity, route changes to address community concerns, and increases in labour and supply costs. RenewEconomy
- Mike Cannon-Brookes and investment company Quinbrook have won the bid for huge NT solar project Sun Cable. RenewEconomy
- Andrew Forrest, the other billionaire involved in the original project, said in a statement that he had not submitted a bid and decided to focus on other renewable projects.
- Several offshore wind developers are competing for feasibility licences in Gippsland, which would give them exclusive rights over certain areas for 7 years. AFR