The Australian Energy Regulator (AER) today published a report into energy prices exceeding $5,000 per megawatt hour (MWh) in the National Electricity Market (NEM) during January, February, and March 2025.
The wholesale 30-minute price of electricity exceeded $5,000 per MWh 11 times in the quarter. This compares to 23 high prices in the previous quarter and 26 high prices in the same quarter last year. Most of the high prices this quarter were forecast.
High prices occurred 4 times in New South Wales (NSW), 3 times in Queensland, 3 times in South Australia and 1 time in Victoria.
The high prices occurred due to a combination of contributing factors rather than one single driver, including high demand, low wind output, network limitations and participant rebidding (mostly for technical reasons).
There were many periods when demand was high but prices remained low due to sufficient low-priced supply.
In many cases we observed market dynamics functioning as designed, with participants rebidding significant amounts of capacity from high to lower prices, preventing high prices from eventuating.
The high price events occurred across 7 separate days in January, February and March 2025:
- 15 January in NSW for one 30-minute period
- 22 January in Queensland for three consecutive 30-minute periods
- 1 February in South Australia for one 30-minute period
- 3 February in South Australia and Victoria for one 30-minute period each
- 5 February in NSW for one 30-minute period
- 12 February in South Australia for one 30-minute period
- 15 March in NSW for two consecutive 30-minute periods
Today’s report follows the release of the AER’s latest Wholesale markets quarterly report for January to March 2024.
Background
The AER is required to report into significant price outcomes in the NEM.
30-minute wholesale electricity prices do not often reach $5,000 per MWh, but with a market price cap of $17,500 per MWh prices can occasionally exceed this reporting threshold. This reporting framework is intended to pick up these outlier events.
A high price may occur due to a variety of factors, including outages that adversely affect supply-demand conditions in the wholesale market.
The AER’s role in monitoring wholesale energy markets and reporting on high price events helps to enhance market transparency and compliance.
Our analysis provides a foundation to detect non-compliance, market irregularities, inefficiencies, and consumer harm. We draw on this work to advise stakeholders and market bodies on wholesale market issues.
The AER has published a Guideline for how we report into significant price outcomes.