November 2024 Electricity Market Review

Market Commentary

Electricity spot prices rose substantially across the entire National Electricity Market (NEM), with most states doubling over November 2024. 

The spot market situation had a knock-on effect on wholesale futures prices with pricing rising in all states except Queensland which experienced an overall drop of a few cents from the start of the month. 

Several factors at play influenced the markets, with New South Wales copping particularly volatile pricing. 

The first taste of summer heatwaves, combined with a series of outages—both planned and unplanned, at several generation units as well as transmission outages on the energy grid—and the extension of some planned outages, triggered huge price increases. 

Demand was high and supply was tight, leading to a price squeeze that triggered several market cap events. 

Australia’s main electricity grids narrowly avoided blackouts as the Australian Energy Market Operator (AEMO) grappled with widespread outages at ageing coal-fired generators in New South Wales and Queensland.  

The outages intensified supply pressures, with AEMO issuing—and later cancelling—a Lack of Reserve 3 (LOR3) warning for NSW. 

Four of NSW’s 12 coal units were offline, including major outages at Bayswater, Eraring, and Vales Point power stations, along with the Tallawarra A gas plant.  

Queensland also faced significant disruptions, including at Kogan Creek, the country’s largest coal unit.  

Collectively, more than 3 GW of fossil fuel capacity was missing, leaving grids strained during an unseasonably intense heatwave. 

AEMO CEO Daniel Westerman assured the public that demand could be met by tapping demand response measures and postponing non-essential maintenance.

However, he warned that additional outages could push the grid to its limits. The delayed return of a 720 MW unit at Eraring highlights the growing unreliability of ageing coal plants, even as NSW underwrites their continued operation. 

Project EnergyConnect transmission line would have helped alleviate NSW spot price stress 

Interestingly, at the peak of spot prices in New South Wales, the state was experiencing a shortfall of some 800 MW in supply. 

Had Project EnergyConnect been 100 percent operational, South Australia could have exported 800MW to NSW, mitigating some of the supply shortfalls. 

The project is the first major transmission line to be built in the country in over 15 years.  

Linking Robertstown in South Australia, Buronga and Wagga Wagga in NSW, and Red Cliffs in Victoria, the project will deliver 800 MW of transfer capacity, enabling a two-way flow of electricity.  

Transgrid has completed the 135-kilometre western alignment stretching from Buronga to the South Australian border. Testing has commenced on this section, with initial results enabling the safe transfer of 150 MW of electricity between the states. 

The transmission line project is expected to be fully operational by July 2027. 

Overhaul of Electricity Market to Accelerate Renewable Energy Revolution 

The Federal Government has appointed an expert panel to craft a roadmap for a grid dominated by renewable energy.  

The government acknowledges that the current market design, built around centralised fossil fuel generation, is ill-equipped to manage the surge of wind and solar projects, the rapid uptake of battery storage, and the growing influence of consumer technologies like rooftop solar and electric vehicles.  

The shift to a decentralised, two-way energy market is well underway, but the rules of the game are lagging. 

The mandate of the panel is to design market mechanisms that unlock investment in renewable energy and storage solutions, ensuring the grid remains stable and reliable as Australia targets 82% renewables by 2030.  

The task is further complicated by the looming retirement of coal-fired power stations and the rise of consumer-owned energy systems, from solar panels to home batteries. 

Federal Energy Minister Chris Bowen has underlined the urgency of these reforms, taking aim at opposition parties for their continued advocacy of coal and nuclear technologies. 

 The energy transition, he argues, requires bold action and modern solutions. Analysts and consumer advocates have welcomed the government’s approach, calling it a critical step toward empowering households and businesses to play a leading role in Australia’s clean energy future. 

The proposed reforms are set to reshape Australia’s energy landscape, paving the way for a system that delivers clean, affordable, and dependable power while supporting the rapid evolution of consumer-driven technologies. This is a watershed moment for the nation’s energy sector, as it takes decisive steps toward a sustainable future. 

Queensland Commits $1.4 Billion to Prop Up Ageing Coal Fleet 

A day after the near blackouts, Queensland’s new LNP government pledged $1.4 billion over five years to maintain its coal-fired generators.  

Coal supplies 66% of Queensland’s power, and the LNP aims to keep its state-owned fleet operational, rejecting federal calls for nuclear while opposing new wind projects. 

Premier David Crisafulli and Energy Minister David Janetzki introduced the “Energy Maintenance Guarantee,” citing the 2021 Callide plant explosion under Labor as justification.  

Critics argue the policy neglects renewables, with the Queensland Conservation Council labelling it wasteful, noting coal plants are outdated and vulnerable to heat. 

The state’s renewable projects and rooftop solar uptake could still meet Labor’s 50% renewable target by 2030, but the LNP has dismissed longer-term goals. 

South Australia Revives Diesel Plants Amid Demand-Side Failures 

South Australia plans to revive two mothballed diesel generators as a reserve option, highlighting its struggles with demand-side measures while targeting 100% renewables by 2027. The state’s energy minister, Tom Koutsantonis, aims to bring Engie’s 75 MW Port Lincoln and 63 MW Snuggery plants back online for the next two summers to avoid forced load shedding during high-demand periods. 

Critics argue that this policy neglects efficiency measures and burdens consumers with high costs.  

New South Wales

Wholesale Electricity Base Load Futures:

*The ASX has ceased to report on electricity futures prices for the year 2024. As a result, reporting now covers the years 2025, 2026, 2027

Average Movement Summary:

New South Wales electricity futures prices for 2025 began the month at $121/MWh climbing sharply to $136/MWh before correcting slightly and ending the month at $130/MWh. 

Prices for 2026/27 followed the same trend but at a cheaper price. Prices have dropped significantly since the crisis in October 2022 but are still $24/MWh costlier than the same period last year.  

Start comparing current market offers and make your procurement process a breeze. Take the first step and get started here!  

Commentary:

• New South Wales’ electricity spot prices have skyrocketed in November 2024, more than doubling in price from 77/MWh in October to $219/MWh.
• Electricity spot prices in November 2024 are more than double what they were in 2023, higher than in September when the average price was $87/MWh.
• New South Wales endured an extremely volatile month in November with 50 instances where spot prices were above $10,000/MWh. There were also 20 incidences where pricing hit or was very close to the market cap of $17,500/MWh.
• The bulk of trading took place at around the $200/MWh mark. Incidents of negative pricing numbered around 1,000, with a maximum low of -$60/MWh.
• Renewables shares in November 2024 dropped slightly from 43% of the energy mix to 42.3%. Reliance on gas increased from 0.5% to 2.2%. Coal contribution dropped from 56% to 55.5%.
• There was no contribution whatsoever from large-scale batteries in November. Gas generation costs skyrocketed from $156/MWh to $790/MWh. Renewables also increased dramatically in price from an average cost of $51/MWh in October to $244/MWh in November. Coal also increased from  $90/MWh to $269/MWh.

Start comparing current market offers and make your procurement process a breeze. Take the first step and get started here!  

Victoria

Wholesale Electricity Base Load Futures:

*The ASX has ceased reporting on electricity futures prices for the year 2024. As a result, reporting now covers the years 2025, 2026, 2027

Average Movement Summary:

Victoria futures prices opened the month at $73/MWh. Following the same trend as NSW, futures prices climbed sharply to $86, before correcting slightly to close the month at $80/MWh.

Prices for 2026 and 2027 followed the same pattern but at a cheaper cost.

Electricity prices have fallen significantly since the crisis in October 2022, but they are still $11/MWh higher compared to the same period last year.

Start comparing current market offers and make your procurement process a breeze. Take the first step and get started here!  

Commentary:

• Victorian average spot prices increased substantially from $20/MWh in October to $64/MWh.
• Electricity spot prices are around double what they were in 2023 for the same period.
• Victoria’s spot pricing was calm compared to NSW IN November, with the highest trading price registered at $595/MWh. The bulk of the trading occurred around the $60/MWh mark.
• Incidents of negative pricing decreased from around 3,000 to around 2,500 with five lows of -$1,000/MWh.
• The share of renewables in generation remained stable at 47%. Coal generation climbed from 52% to 59% of the energy mix. Gas increased substantially from 0.3% to 2.3% of the generation mix. 
• Batteries did not feature in Victoria’s November energy mix. The average cost of renewables increased from an all-time low of 50c/MWh in October to $53/MWh. Coal increased from an average of $34/MWh to $87/MWh and gas increased from $137/MWh to $157/MWh.   

Queensland

Wholesale Electricity Base Load Futures:

*The ASX has ceased to report on electricity futures prices for the year 2024. As a result, reporting now covers the years 2025, 2026, 2027

Average Movement Summary:

Queensland futures electricity prices for 2025 opened the month at $108/MWh. Like NSW and Victoria, prices spiked to $117/MWh before settling back to $111/MWh to close the month. Prices for 2026 and 2027 followed the same trend but at a cheaper cost.

Electricity prices have come down since the crisis in October 2022 but are $21/MWh costlier than the same period last year.

Start comparing current market offers and make your procurement process a breeze. Take the first step and get started here!  

Commentary:

• Queensland electricity spot prices more than doubled in November 2024, increasing from $71/MWh at the end of October to $178/MWh.
• Queensland spot prices are significantly costlier than they were in October 2023, when the average price was $72/MWh.
•  Queensland also experienced a very volatile month on the spot market with 40 instances of pricing above $9,000/MWh and 21 instances where pricing was over or close to $15,000.
• There were around 1,300 instances of negative pricing with two lows of -$125/MWh. The bulk of trading occurred at the $150/MWh mark.
• Renewables in Queensland performed poorly in 2024 but picked up in the second half of the calendar year. November’s share deteriorated from 37% to 31%. Coal generation remained stable at 60%. Gas increased substantially from 5.2% to 9.3%.
• Batteries supplied 0.002% of total generation. Battery energy average costs increased from $192/MWh to $942/MWh. Gas averaged a cost of $411/MWh, coal $231/MWh and renewables increased from $16/MWh to $218/MWh.

South Australia

Wholesale Electricity Base Load Futures:

*The ASX has ceased to report on electricity futures prices for the year 2024. As a result, reporting now covers the years 2025, 2026, 2027

Average Movement Summary:

As usual, South Australia’s wholesale electricity futures prices for November 2024 displayed a different trend to other states, due to its different energy mix, of which the majority are renewables and the rest gas.

2025 futures started the month at $101/MWh,  climbing steadily throughout the month to close at $108/MWh. Prices for 2026 followed a similar trend while 2027 prices remained flat.

Prices have come down substantially since the crisis in October 2022 and are $4/MWh costlier than last year.

Start comparing current market offers and make your procurement process a breeze. Take the first step and get started here!

Commentary:

• SA’s average electricity spot prices almost doubled from $35/MWh to $60/MWh by the end of November.
•  Electricity spot prices in November 2024 were $10/MWh cheaper than they were in 2023.
•  Usually known for its pricing volatility, South Australia (SA) enjoyed a relatively calm month in the spot market. The highest price registered was $1525 when prices usually hit the market cap at least once.
• Around 3,000 negative pricing incidents were recorded during November 2024 with 10 incidences of pricing falling to below -$900.
• Renewables’ share of the mix dropped substantially from 87% to 77%. Conversely, gas generation doubled from 11% to 22% of the generation mix.
• Battery contributed 0.08% and averaged a negative cost of -$24/MWh. Gas cost an average of $150/MWh, and renewables increased substantially from an average of $5.57/MWh to $43.  

Take Control of Your Energy Costs 

There is also a lot of activity in the wholesale futures market as the calendar year draws to a close. Many businesses and industrial energy users are going to the market to make forward purchases of wholesale electricity while prices are relatively soft.  

It is worth observing that businesses can go to the market to secure a new contract in advance, even if their current electricity contract is still in effect. 

Depending on your business’s risk appetite, now could be a good time to secure a new energy contract. 

Act now! Reach out to one of our experienced energy consultants today and gain valuable insight into the potential costs that may lie ahead. Don’t wait—take control of your energy expenses now! 

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Expert Advice: Our team of energy consultants has in-depth knowledge of the energy market and can provide tailored advice to suit your business needs. 

Cost Savings: Learn how to reduce your electricity costs and improve your business’s energy sustainability. 

Proactive Planning: Stay ahead of market changes and make informed decisions with our comprehensive market updates. 

Contact our team for advice on reducing electricity costs and improving your business’ energy sustainability. We are here to assist you and explore your options together. 

Explainer:  Why we focus on Wholesale Futures Prices

Wholesale Futures Price: This reflects what the market expects wholesale electricity spot rates to be in future periods. The offers that commercial and industrial (C&I) customers receive via Leading Edge Energy are closely correlated to wholesale prices on the ASX Energy futures market; this is why we focus on these prices in our commentary.

Spot Price: This represents how much the spot market is charging for electricity currently based on demand and supply. Spot prices go up when demand is high and supply is tight. You can view live Spot Prices here. 

You can learn more about the difference between wholesale electricity futures and spot prices in our blog section.

Disclaimer: The information in this communication is for general information purposes only. It is not intended as financial or investment advice and should not be interpreted or relied upon as such.

We source, analyse, compare and rank commercial, industrial and multisite energy quotes. Obligation Free.

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