Spot prices for the week averaged $18/MWh in Queensland, $20/MWh in New South Wales and $22/MWh in Victoria. These prices were consistent with the previous week.
In South Australia prices averaged $53/MWh, up by around a third compared to previous week. The higher average price resulted from one $5000/MWh spike on Wednesday, when one circuit of the Heywood interconnector was taken out of service without notice, reducing flows into South Australia by a third. This network outage coincided with a significant reduction in capacity offered at lower prices by TRU Energy. This pricing pattern, established well in advance, has been observed regularly since mid October.
Commissioning tests of the new Basslink interconnector between Tasmania and the mainland saw flows for the first time of up to 140MW on Thursday 1 December. Measurement errors, during this testing, led to a spot price of almost $2200/MWh at around 2.30pm that day. The average spot price in Tasmania was $56/MWh for the week.
Turnover in the energy market for the mainland was $78 million. The total cost of ancillary services for the week was around $500 000 or less than one per cent of turnover. Turnover in Tasmania for the week was $10 million and the cost of ancillary services was $450 000 or 4.5 per cent of turnover. Around $300 000 of that cost occurred as a result of the measurement error on 1 December.
Significant variations between actual prices and those forecast 4 and 12 hours ahead occurred in 18, or five per cent, of trading intervals, with demand forecast error the main contributor. Demand forecasts produced 4 and 12 hours ahead varied from actual by more than 5 per cent in around a quarter of all trading intervals across the market. These variations were most frequent in South Australia occurring in around two thirds of all trading intervals.
The AER would welcome comments on the information contained in, or the layout of, the report. Comments should be sent to Peter Adams or Mark Wilson, AER, GPO Box 922, Adelaide SA 5000 (email AERInquiry@aer.gov.au; fax (08) 8213 3414).
Figure 1 sets out national demand and spot prices in each region for each trading interval. Figure 2 compares the volume weighted average price with the averages for the previous week and the same quarter last year. Figure 3 compares the weekly price volatility index on the same basis.
Figure 1 National demand and spot price all regions
Figure 2 Volume weighted average spot price for energy market ($/MWh)
Maximum spot prices for the week were $43/MWh in Queensland and New South Wales, and $47/MWh in Victoria. In Tasmania the maximum spot price was $2200/MWh just after midday on Thursday. In South Australia the maximum spot price was $5000/MWh on Wednesday afternoon.
There were no low reserve conditions forecast for the week.
The total cost of ancillary services on the mainland for the week was around $500 000 or just over 0.5 per cent of the total turnover in the energy market. On a number of occasions during the week, lightning led to a reduction in flows from Queensland to New South Wales. This resulted in a minimal requirement for lower contingency services to be sourced locally in Queensland. The cost for these local services totalled around $9000.
Figure 4 Volume weighted average frequency control ancillary service prices (excluding Tasmania)
Raise
Lower
6 sec
60 sec
5 min
Reg
6 sec
60 sec
5 min
Reg
Last week($/MW)
2.13
0.71
1
1.55
0.43
2.1
3.36
1.7
Previous week ($/MW)
1.8
0.6
1.02
1.59
0.27
1.82
5.51
1.77
Last quarter ($/MW)
1.62
0.91
1
1.36
0.2
0.64
2.29
1.56
Market cost($1000s)
109
36
67
34
5
71
149
37
% of energy market
0.14%
0.05%
0.09%
0.04%
0.01%
0.09%
0.19%
0.05%
The total cost of ancillary services in Tasmania for the week was $450 000 or 4.5 per cent of the total turnover in the energy market in Tasmania.
Figure 5 Tasmanian volume weighted average frequency control ancillary service prices
Raise
Lower
6 sec
60 sec
5 min
Reg
6 sec
60 sec
5 min
Reg
Last week($/MW)
1.12
1.05
1.05
1.05
24.75
1.05
1.05
1.05
Previous week ($/MW)
1.15
1.05
1.05
1.08
1.09
1.05
1.05
1.05
Tasmania Market cost($1000s)
9
10
10
9
351
33
26
9
% Tasmania of energy market
0.1%
0.1%
0.1%
0.09%
3.58%
0.34%
0.26%
0.09%
Figure six shows the daily breakdown of price for each frequency control ancillary service. It also includes the cost of services sourced locally and in Tasmania.
Figure 6 Daily frequency control ancillary service prices
Figure seven shows the weekly participation in each of the ancillary service markets on a regional basis.
Figure 7 Regional participation in ancillary services
Figures eight and nine show 30-minute prices for each of the ancillary services.
Figure 8 Prices for raise services
Figure 9 Prices for lower services
Figures 10 and 11 show the 30 minute Tasmanian price for each of the ancillary services.
Figure 10 Tasmanian prices for raise services
Figure 11 Tasmanian prices for lower services
Figures 12 and 13 present both the raise and lower requirements for each service over the week.
Figure 12 Raise requirements
Figure 13 Lower requirements
Figures 14 and 15 present both the raise and lower Tasmanian requirements for each service over the week.
