Variable renewable energy

  • Commercial and market outlook

    The Very Fast FCAS market is about to commence – a look at a possible time-of-day profile for R1

    On 9 October 2023, 1pm (market time), the dispatch of the new Very Fast (VF) FCAS market in the NEM will commence and will add two new markets for contingency FCAS, Raise 1 (R1) and Lower 1 (L1). AEMO has released a final industry go-live plan to keep track of...

  • Energy storage and flexibility

    How long is the ‘Golden time of day’ for batteries?

    A key part of the business case for grid-scale standalone batteries is the arbitrage opportunity between low daytime wholesale prices (when renewable energy generation from solar is plentiful) and high evening prices (when the sun goes down and household demand ramps up quickly). The share of battery revenue coming from...

  • Low carbon generation

    MLF changes in NSW in the past decade

    MLF, short for Marginal Loss Factor, represents the portion of electricity losses that occur along the transmission network between a connection point and the Regional Reference Node (RRN). Within the NEM, the MLF serves as a metric to quantify these losses along the network, playing a pivotal role in determining...

  • Commercial and market outlook

    Zap, Crackle, Pop! SA’s shocking electric dance party on the 11th

    Across the mainland states in the NEM, South Australia (SA) relies heavily on variable renewable energy (VRE) resources. SA is an excellent subject to test the premise “What if the wind doesn’t blow, and the sun doesn’t shine”? Negative spot prices persist in South Australia due to an abundant supply...

  • Commercial and market outlook

    Polarisation of wholesale spot prices leads to opportunity for arbitrage services

    Over the last five financial years, South Australia has seen a significant increase in price volatility, with substantial portions of time both negative and above $250/MWh, leading to increasing opportunities for storage systems to provide arbitrage services. A number of events initiated the reduction in wholesale energy prices between $50/MWh...

  • Power and gas networks

    The Quest of the Ring: Will the Sydney Ring of Power unlock commercial viability of renewables?

    With the development of Renewable Energy Zones (REZs), the need for transmission augmentation arises to unlock the transfer of energy from Renewable Energy Zones to major load centres. This may subsequently increase the commercial viability of renewable generators within the Renewable Energy Zones, for example, by reducing plants’ technical curtailments...

  • Regulation and policy

    “Behind-the-Connection-Point” A match made in heaven?

    The AEMC's new rule change for storage integration into the NEM provides more flexibility for hybrid systems and VRE owners to more effectively level their bids and participation into the market. This means, if the new rule takes place, hybrids can manage their own internal energy exchange behind the connection...

  • Energy storage and flexibility

    Feeding the future NEM – Eat some now. Save some for later.

    As the NEM continues to transition towards increased penetration of variable renewable energy (VRE), the use of the word ‘curtailment’ has also increased. While curtailments have historically been a natural part of market outcomes (i.e. generators withholding capacity at higher price points), the increased prevalence of curtailment of VRE is...

  • Low carbon generation

    Australian Chart of the week | Examining Victoria’s recent wind drought

    This ‘Chart of the week’ examines the recent spell of low wind generation in Victoria and associated elevated prices. Previously, ‘Chart of the week’ issue 78 highlights the risk of wind droughts within the National Electricity Market (NEM) due to the high correlation of wind fronts both within states and...

  • Low carbon generation

    Australian Chart of the week | VRE pays more as PFR helps reduce coal FCAS costs

    In our previous ‘Chart of the week’ in November 2020, we reviewed the increasing percentage of causer pays cost that solar generators bear due to their generation profiles and how this results in them paying significantly more of the causer pays cost as a ratio of the generation they provide. More than...

  • Low carbon generation

    Australian Chart of the week | 3 2 1… fight: VRE and price cannibalisation in NEM

    In the last decade, the rapid decline in deployment cost of variable renewable energy (VRE) generation capacity has given renewables an advantage over fossil fuels for new builds as highlighted in ‘Renewable Power Generation Costs in 2020’ report from the International Renewable Energy Agency (IRENA). In the report, Australia has...

  • Energy storage and flexibility

    Australian Chart of the week | Slow is smooth and smooth is fast for the NEM transition

    Reporting season is all but over for the energy majors in Australia and that has left us with a bevy of takeaways on the sentiment for the not-so-distant future. A key thread among reports has been the current low-price environment in the NEM. This is a topic that we have...

  • Power and gas networks

    Lower prices but a similar story for those setting the price

    2020 was one for the books with plenty of interesting events happening worldwide and also in the energy markets. For the NEM specifically, it was a time of significant changes in price outcomes compared to the previous years of comparatively higher prices. However, now comes the question of whether NEM...

  • Low carbon generation

    Australian Chart of the week | Race to the bottom: Negative prices on the rise and spreading

    Negative prices are becoming a more frequent occurrence in the NEM as variable renewable energy (VRE) plays a larger role in the supply mix. Negative priced offers from generators form a large part of the MW capacity offered into the market. The negative prices we see in dispatch intervals reflects...