Solar boom unleashes surge of below-zero power prices

afr.com:

Plentiful solar power drove wholesale electricity prices below zero a record 19 per cent of the time on the National Electricity Market in the September quarter, piling further economic pressure on ageing coal-fired power plants still needed to meet the bulk of demand.

All regions of the market experienced an increase in negative prices, driving down the daytime average, according to an Australian Energy Market Operator report released on Monday.

Consumers are yet to see any benefit from the dramatic softening in wholesale prices, having been slugged with steep price increases earlier this year.

Electricity default tariffs for households in several states rose by more than 20 per cent on average on July 1, with some customers reporting their bills almost doubled. Whether those tariffs retreat next year hinges partly on wholesale market performance over summer, when AEMO has already warned of potential squeezes as hot El Nino conditions return.

Renewable energy reached almost 39 per cent of total electricity supply in the third quarter of 2023, helping push down average wholesale electricity prices by more than two-thirds.

Rooftop solar output boomed in the September quarter. Bloomberg

The AEMO analysis found multiple records were broken in the power market in the quarter, including reaching a record 11.9 gigawatts of rooftop solar output.

The booming rooftop solar generation helped renewable energy reach a record 70 per cent of total electricity supplied over one half-hour period.

But it also highlights the mounting strain on coal-fired power plants that still supply almost 60 per cent of Australia’s power on average through the year, but which are increasingly undercut in price by cheap wind and solar on the wholesale