Know Your NEM: Heating demand up, wind output down, but low prices locked in | RenewEconomy

Know Your NEM: Heating demand up, wind output down, but low prices locked in

Demand is up in past month, and wind was down, but renewables share has grown over last 12 months and is helping lock in low prices for next year or two.

Infigen Energy's Cherry Tree wind farm (credit: Infigen Energy).

Left hand columns are for latest 30 day period, right hand columns for the moving average for last 12 months. Source: NEM Review

The last month has thrown up a few interesting data points. Most notably an increase in total demand in the National Electricity Market (all states except W.A. and NT) to an annualised level of 209 terawatt hours. That’s above last year and the highest level in four years for an annualised figure in this particular period.

Perhaps it’s the case that office air-conditioning and heating is more efficient than home heating, and now most are working from home. But who knows. Maybe it’s just the weather.

Another notable point is the collapse in wind output in all states except Queensland, but particularly in South Australia and Victoria, the two states with traditionally the biggest output of wind power in absolute terms.

As a result the overall share of variable renewable energy (VRE, or wind and solar) is below the same period last year.

Figure 2. Source: NEM Review


VRE by fuel
Figure 3. Source: NEM Review

The result of the reduction in VRE was a jump  in spot prices for electricity to not much below last year, and despite low coal and gas prices:

Spot prices
Figure 4. Source: NEM Review

But the medium term outlook over the next two years is still for sharply lower prices, with a mid point of around $50/MWh a good working number for FY22:

Figure 5 Source: ASX


Figure 6. Source: NEM Review

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