The Australian Energy Market Operator (AEMO) has released its Quarterly Energy Dynamics (QED) – Q4 2019 report, which tracks the market impacts of extreme heat, generator and transmission line outages, as well as the shifting supply mix in the country.
Australia experienced its hottest and driest year on record in 2019, and also saw their second-lowest annual hydro generation output in a decade. The market impacts of prolonged and extreme heat and dry conditions experienced across the country, together with the tragic bushfire emergency, are also reflected in this final quarter report.
Key report findings:
Black coal-fired generation decreased by 1,061 MW on average compared to Q4 2018, reaching its lowest quarterly level since Q4 2016. The decline was due to a combination of coal supply issues (notably at Mt Piper which fell an average 552 MW), unit outages, and displacement by solar output.
Total variable renewable energy (VRE) output across the National Electricity Market (NEM) continued to rise this quarter. During Q4 2019, average grid-scale VRE generation reached 2,868 MW, representing a 39 percent increase from last year. VRE generation accounted for 14 percent of the NEM supply mix in Q4 2019 compared to 10 percent in Q4 2018.
Market revenue for grid-scale batteries also trended upwards this quarter, driven by increased returns from Frequency Control Ancillary Services (FCAS) markets. Total Q4 2019 battery revenue of $20m represents the highest quarter on record, 70 percent higher than the previous record.
For gas, total east coast gas demand for the quarter was 15 percent higher than in Q4 2018 due to increased demand from GPG and higher liquified natural gas exports from Curtis Island. Meanwhile, wholesale gas prices continued their downward trend from Q3 2019, falling by an average of 26 percent compared to Q4 2018 and reaching their lowest levels since the end of 2017.
Wind and rooftop PV generation in Western Australia increased by an average 87 MW and 63 MW, respectively. This change in generation mix was most pronounced at 11.30 hrs on 30 November 2019, when the South West Interconnected System recorded its highest ever level of VRE penetration. During this 30-minute period, 51 percent of underlying system demand was supplied by VRE output. For the first time since the WEM commenced in 2006, the wholesale electricity price cleared at the Minimum STEM Price, for three Trading Intervals in October 2019. This outcome was driven by record low demand combined with high rooftop PV generation and participant bidding behaviour.
For the full report and further details, click here.