The biggest spike in electricity prices in South Australia in the last week of June was caused by the failure of a unit at one of the state’s biggest gas generators, according to the latest report by the Australian Energy Regulator.
The AER is required to issue a report each week on the cause of unusual price movements. Its report for the week ended June 25 has just been released, nearly a month later, and notes that the biggest spike in prices occurred late on Friday, June 24, when the price in one interval surged above $1500/MWh.
It says the cause of this was the delayed return to service of unit 4 in the Torrens A gas fired power station, which had tripped earlier in the day, taking it out of service.
The AER says this effectively reduced available supply in South Australia by 120MW. And because there were network issues that were causing constraints in available capacity elsewhere in the network, this forced the dispatch price leap from $300/MWh at 6.10 pm to $1527/MWh at 6.15 pm.
Prices returned to below $150/MWh for the remainder of the trading interval, but the average price remained at just below $500/MWh, the highest for the week.
The AER reports for previous weeks also noted most of the major price spikes were caused by the unexpected loss of capacity at various coal and gas plants, including the Eraring coal generator in NSW, and the Loy Yang B brown coal generator in Victoria.
On top of this, capacity at two gas plants was withdrawn at the last moment because the operator decided it would not be economic to switch them on. And of course, there were record gas prices which pushed up the price of gas fired generation.
So, it’s not all the fault of wind energy or the lack of it, as the mainstream media and the fossil fuel lobby would have you believe. The AER reports for the following weeks, when the price surged to even higher levels, should make interesting reading.
