Gas is getting left behind as solar-charged batteries step in to the breach

Australia’s NEM is increasingly operating as a renewables-and-storage system, with fossil fuels, particularly gas, associated with the costly end of the market.

Daily battery discharge has risen from only 1-2 gigawatt-hours (GWh) in early 2024 to frequent 15-20 GWh days by mid-2026, with recent peaks above 20 GWh (Figure 1).

That is the time-proven case we outlined earlier this year – batteries are no longer merely ancillary assets, they are increasingly shifting renewable generation, especially solar, into higher-value evening periods and displacing gas peakers.

Figure 1. Australian National Electricity Market electricity from daily utility battery discharging 2024-2026 – AEMO data to 13 Aug 2026

In 2024, battery shares were mostly below 0.5% and high price outcomes were common (Figure 2). With massive growth through 2025 and continuing into 2026, daily battery shares frequently exceed 1.5-2.5%, occasionally reaching around 3.5%, while the dense cluster of outcomes is generally around $A40-100/MWh (Figure 2).

Figure 2. Daily battery share vs Daily Volume Weighted Price stratified by half years – AEMO data 2024-2026

This is not proof that batteries alone determine prices, but it is consistent with their growing role in removing high-price, gas-set intervals from the volume-weighted average (Figure 3).

Figure 3. Daily gas share vs Daily Volume Weighted Price stratified by half years – AEMO data 2024-2026

Figure 4. Daily renewables share vs Daily Volume Weighted Price stratified by half years – AEMO data 2024-2026

Figure 5. Daily coal share vs Daily Volume Weighted Price stratified by half years – AEMO data 2024-2026

The price pattern is clear

Across updated scatterplots, the relationships align with our earlier analysis:

– Higher renewable shares above 50% bring lower daily prices below A$100/MWh (Figure 4);

– High coal shares remain associated with a wider and more expensive distribution of outcomes (Figure 5);

– Price rises strongly with gas share; the largest daily price spikes (pricing volatility) remain concentrated on higher-gas days, and conversely the lowest prices occur when gas share is contained (Figure 3); and

– Greater battery dispatch coincides with a lower, tighter price band despite their still modest energy share (Figure 2).

A consistent transition

As renewables and batteries expand, they reduce exposure to fuel-driven price spikes and push gas toward a diminishing high-cost role. 

Figure 6. Australia National Electricity Market annual generation by major source 2010-2026 – AEMO data 2025 via OpenElectricity

The 2026 data adds weight to the case that “solar daylight saving” – charging batteries in abundant daytime solar and dispatching later – is now a material market force, and no longer just a future promise.

Once battery capacity is sufficient, there will be no role for gas.

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