Victoria

  • Commercial and market outlook

    VNI West selected path; an incentive for delaying coal retirements?

    On 29 May 2023, AEMO published a conclusions report on the VNI West Project. According to the report, option 5A (a variant of  AEMO’s preferred option in a previous consultation paper) is preferred for VNI West. In option 5A, the transmission line crosses the Murray River north of Kerang (Wamba...

  • Commercial and market outlook

    It’s the Liddell things that matter

    Australia’s oldest coal-fired power plant Liddell retired completely in the last week of April 2023 after 52 years. This giant of AGL, which had a total registered capacity of 2,000 MW, operationally acted as a 1600MW station and 1200MW after the closure of its third unit. Australia’s transition to clean...

  • Commercial and market outlook

    Patriots ‘Dynasty’ off to a rough start, as New England suffers loss to the MLFs…

    For many, the first of April is marked in calendars as a day for jokes and silly nuisances. For the few, specifically the energy industry, we have it pencilled in for the release of the upcoming year’s Marginal Loss Factors (MLFs). Over the last half-decade, movements in MLFs have received...

  • Power and gas networks

    Forced imports: VIC-NSW interconnector summer moonwalk?

    A lot has been written recently about how the energy transition is lagging behind the required installed capacity needed to deliver on our net-zero future. We also know that the connection of new generation requires significant investment into additional transmission infrastructure (or other non-network solutions) and that this needs to...

  • Low carbon generation

    Building up the road to the coast – can we deliver energy from Gippsland’s offshore wind?

    On 19 December 2022, the Federal Minister for Climate and Energy officially declared the area in Bass Strait off the Victorian Gippsland Coast suitable for offshore wind. The declared area covers approximately 15,000 square kilometres, from Lakes Entrance in the east to south of Wilsons Promontory in the west. Based...

  • Energy storage and flexibility

    State of Storage: Investigating battery profit for NEM states

    It has been an interesting year for Australian energy markets, facing unprecedentedly high energy prices, coal outages, and market suspension. In today’s Chart of the week, we will investigate the impact a BESS would have made during FY 2022. Using Cornwall Insight Australia’s battery simulation model, we simulated a stand-alone...

  • Low carbon generation

    Loy Yang A closure: How much VRE and firming capacity is required to cover peak hours?

    AGL has accelerated the closure of the Loy Yang A power station for the second time in 2022, a few days after the Victorian government announced a target of 2.6 GW storage by 2030, increasing to 6.3 GW storage by 2035. According to the AGL announcement, released on 29 September,...

  • Commercial and market outlook

    Off the charts: ESOO flags earlier reliability shortfalls but no need to panic yet

    In the space of a year, the prospect of reliability shortfalls in the NEM has increased significantly. This is the stark finding of AEMO’s latest Electricity Statement of Opportunities (ESOO) report. In our Chart of the week, we illustrate how reliability forecasts have deteriorated in just a year, and we...

  • Power and gas networks

    Losses or gains? What do transmission upgrades mean for Marginal Loss Factors

    AEMO’s 2022 Integrated System Plan has listed a group of committed and anticipated network projects, including VNI Minor, QNI Minor, and the Western Renewables Link (WRL). Besides relaxing network constraints, improving reliability, and unlocking generation capacities, transmission upgrades may also impact the Marginal Loss Factor (MLF) around the planned area....

  • Low carbon generation

    Analysing earlier coal retirement in Victoria: What does it take for more emission reduction?

    AEMO has recently published the 2022 Integrated System Plan (ISP), which provides an energy transition roadmap for the National Electricity Market (NEM). This ISP focuses on the “Step Change” scenario, which reflects strong action on climate change leading to a step change reduction of greenhouse gas emissions, based on the...

  • Commercial and market outlook

    Big Battery, even bigger revenues

    The Victorian Big Battery (VBB) in Geelong, Victoria, is currently the largest commissioned battery in the NEM at 300 MW/450 MWh. In Q2 2022, VBB, and its owner Neoen, posted an estimated AEMO wholesale net revenue of just over $13 million for the three-month period. It is important to note...

  • Power and gas networks

    Australian gas markets spike to unprecedented levels

    Australia’s gas markets are in the middle of an unprecedented price spike. Current prices in the Victorian Declared Wholesale Gas Market (DWGM) have been tracking in the $20-40/GJ range since early May 2022, with prices hitting $50/GJ on 30 May. Prices in the other gas hubs of Sydney and Brisbane...

  • Commercial and market outlook

    Nobody said it was easy, but it’s time for us to part: VIC’s climate targets & coal

    In 2017, the Victorian Government legislated a state target of net-zero greenhouse gas emissions by 2050. Since then, short-term targets have been set in five-year increments, with the 2030 target being to cut emissions by 45-50% below 2005 levels. The Government is currently consulting on the 2035 target, which must...

  • Low carbon generation

    Lower energy prices? More than just hot air

    The Victorian Government launched Australia’s first offshore wind targets as part of its transition towards a net-zero emission future. According to the target, 9GW of offshore wind will be installed by 2040, nearly quadrupling the total wind capacity in VIC. In this Chart of the week, we dive into the...

  • Commercial and market outlook

    Is the NEM going off schedule?

    Is the NEM getting harder to control with rising variable renewable generation and distributed photovoltaic growth? AEMO’s balancing of scheduled supply is critical to ensure the system remains stable and wholesale prices work efficiently. This Chart of the week briefly examines if the NEM is “on schedule” to meet this...

  • Commercial and market outlook

    Round and round it goes, where the loop flow stops, nobody knows

    A by-product of how market boundaries are defined, loop flows are phenomena in electricity markets that manifest as flows going in one direction across parts of a network loop and goes the opposite way in other parts of the same network loop. Regardless of whether the market design is nodal...

  • Commercial and market outlook

    The Victorian story of gas demand segments

    The Declared Wholesale Gas Market (DWGM) prices in Victoria have been on a rising trend since the start-up of LNG exports in 2015. Is this trend sustainable, given the Gas Statement of Opportunities (GSOO) forecasts an improved gas supply outlook with the new Port Kembla Gas Terminal (PKGT) expected to...

  • Energy storage and flexibility

    Minimum demand projections in Victoria

    The surplus rooftop solar provides an enormous opportunity for additional flexible load, where this can be optimised during the day. Electric Vehicles acting at a distributed level (exactly where the surplus is arising) provide the perfect solution if utilised in conjunction with smart metering to assist in mitigating these issues....

  • Energy storage and flexibility

    Spring is here, where are you?

    With the onset of spring in September, we typically observe a drop in demand in NEM. However, this year the decline in demand has seen NEM and multiple states breaking several records for minimum operational demand in the middle of the day, which is largely driven by solar penetration in...

  • Energy storage and flexibility

    I can be your hydro baby, I can ramp away the pain

    The recent suite of energy market reforms proposed by the Energy Security Board (ESB) has prompted much discussion about the type of capacity that needs to be procured in a future NEM that seems certain to have a very high penetration of variable renewable energy (VRE). In this Chart of...

  • Energy storage and flexibility

    Australian Chart of the week | Slip slidin’ away, You know the nearer your destination

    In our previous ‘Chart of the week’ back in November 2020 (Issue 61), we looked at the projected uptake of battery storage projects in the National Electricity Market (NEM). Nine months on, with a number of large projects announced, we felt it was worth an update. In our last chart,...

  • 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 | Is the market putting the brakes on distributed solar exports?

    In most states, electricity retailers determine and set their own rooftop solar feed-in tariffs (FITS). A major driver is the wholesale energy prices, which continue to decline midday. For more information, please refer to our previous Chart of the Week issue 76. As the solar weighted wholesale energy prices reduce or become...

  • Energy storage and flexibility

    Australian Chart of the week | Push it to the limit: the evolution of MPC & market tightness

    With summer officially starting last Tuesday, the National Electricity Market (NEM) is about to go through the season that typically has the highest demand. Market tightness usually seen during summer sometimes pushes power prices to their maximum level – the Market Price Cap (MPC) – currently set at $15,000/MWh. In...

  • Low carbon generation

    Australian Chart of the week | You’ll have to share your cake: wind v gas in ‘epeak’ battle

    Spot prices are back in the headlines with increased renewable generation impacting both long term price trends as well as driving intraday value shifts; especially across mainland regions. With significant renewable generation still to come to replace exiting coal as covered in Issue 39, the key question then becomes: how much value...

  • Low carbon generation

    Australian Chart of the week | Things are not what they seem: capturing intraday price volatility

    The Australian Energy Market Operator’s (AEMO’s) recently released Quarterly Energy Dynamics (QED) report for Q1 2020 stated that average spot electricity prices in the National Electricity Market (NEM) fell to their lowest levels in 4 years ($66/MWh) last quarter. Victoria, in particular, witnessed a significant drop – 48% – from...

  • Energy storage and flexibility

    Australian Chart of the week | Is now the time to consider an operating reserve service?

    This summer has already seen a number of instances of tightening supply/demand balance across the National Electricity Market (NEM). This has consequently resulted in a range of reactions from the market operator (AEMO) and other market stakeholders. There were extreme weather events as well as fluctuating supply and disruptions. As...

  • Low carbon generation

    Australian Chart of the week | The fire between us: the day bushfires separated NSW & Victoria

    This summer has already sprung many newsworthy events for the NEM including broader climate discussions with increased tightening of demand/supply balance. On Saturday 4 January, bushfires directly impacted the NEM. They triggered a series of supply disruptions resulting in power prices in NSW hitting value of lost load (VoLL). In...

  • Energy storage and flexibility

    Australian Chart of the week | ESOO highlights the fragility in VIC to generator outages

    he 10-year view in Electricity Statement of Opportunities (ESOO) highlights the fragility of the operational margin across the NEM. In particular, Victoria has identified as under threat of load shedding and an increased possibility of unserved energy this summer. This Chart of the week explores the Australian Energy Market Operator’s...

  • Power and gas networks

    Australian Chart of the week | Elephant in the room: the veiled role of gas markets/supply?

    Queensland Liquified Natural Gas exports commenced in early 2015. Historically, prior to this, gas markets in eastern Australia have been relatively stable. Conventional gas fields supplied large industrial users, business/residential – mass market – load as well as gas-powered generators at relatively low prices. In this Chart of the week,...