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What will happen to electricity prices in 2013?


The month of January 2013 has certainly proven that we live in a sunburnt country of droughts and flooding rains. With the Bureau of Meteorology (BOM) having reported maximum temperatures approaching 50 degrees and daily rainfalls exceeding 400mm in eastern states, electricity markets have started the year with plenty of meteorological dynamics to consider.

Hot on the heels of the AEMO report released late last year that less transmission investment was needed across the electricity network than previous estimates, indications are that lower forecast demand growth is the predominant driver. The changing energy environment that includes lower demand and energy forecasts, the impact of a price on carbon and higher projected gas costs should mean that any short term volatility in electricity prices will be tempered by available capacity in the network. However, there is always the possibility that other factors will come into play. Add this to a Federal Government election later in the year and we may get a very interesting 2013 for all energy related matters…we’ll have to wait and see.

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