Wholesale electricity prices were fairly stable during a mostly mild autumn, before the onset of winter saw prices rise in June, according to the Australian Energy Regulator’s (AER) latest Wholesale markets quarterly report.
The report found that volume weighted average wholesale electricity prices increased in all regions of the National Electricity Market (NEM) this quarter compared to the previous quarter, with increases ranging between $34 per megawatt hour (33%) in QLD and $96 per megawatt hour (132%) in VIC.
Similarly, compared with the same period last year, wholesale electricity prices were 10% to 25% higher across different regions, except in NSW where the price was unchanged.
AER Deputy Chair Justin Oliver said electricity prices were impacted by a large number of high price events (when the 30-minute price of electricity exceeds $5,000 per megawatt hour) in all regions on 11 and 12 June, and in all regions except QLD on 26 June.
“This quarter saw 66 high price energy events – the second largest on record for any quarter. A combination of factors including coal generator outages, low wind output, high demand, interconnector limitations and rebidding behaviours drove these events, pushing prices above the $5,000 per megawatt hour threshold,” said Mr Oliver.
The average level of coal generation capacity unavailable in the NEM due to planned and unplanned outages this quarter increased by 28% (716 megawatts) compared to the same quarter last year.
Increases in volume weighted average wholesale electricity prices this quarter were partially offset by a rise in the number of negative 30-minute prices. There were 612 more negative prices during the quarter compared with the same time last year due to periods of high rooftop solar output, increased wind generation and large-scale solar.
“Total generation across the NEM was 0.2% higher than the same period last year, with gas and coal generation displaced by intermittent renewables such as wind, large-scale solar and energy discharged from batteries.
“A combined 1,456 megawatts of new generation capacity from wind, solar and batteries entered the NEM this quarter – 535 megawatts more than last quarter. Most of these began generating in June and are yet to reach full output,” said Mr Oliver.
Both electricity base futures and cap prices for Q2 2025 were elevated, primarily due to the high price events in June. Forward prices were also impacted, with Q3 2025 base futures rising in most regions.
In contrast to electricity prices, East Coast downstream gas market spot prices fell 6% from the previous quarter (to $12.37 per gigajoule) and were 10.1% lower than the same quarter in 2024.
The decline in East Coast gas market spot prices was caused by lower-than-usual demand for gas, which decreased from 95.6 petajoules this time last year to 89.4 petajoules - the lowest ever recorded for an April to June quarter.
“While warmer than usual weather in April and May reduced demand, including for gas powered generation, and pushed average East Coast prices down to $10.70 per gigajoule, cold weather and coal outages in June increased demand and saw the average price reach $13.40 per gigajoule,” said Mr Oliver.
With the onset of colder weather, gas started to flow from QLD to southern states from mid-May, having earlier flowed north in April.
From the start of June, storage levels at the Iona Gas Storage Facility (VIC) also began to drop sharply. This was due to cool weather, production outages at the Longford Gas Plant - which experienced its lowest ever output for an April to June quarter at 48.4 petajoules - and increased demand for gas-powered generation.
“With low gas demand during April and May, the Iona facility was prepared for the sharp draw down in June when the colder winter weather arrived. At the end of June, Iona was at 17 petajoules, which is higher than storage levels experienced at the same time in previous years,” said Mr Oliver.
Note to Editors
High electricity price events
The AER is required to report into significant price outcomes in the NEM and will publish a high price report in August containing detailed analysis of the April to June high price periods.