Peak Renewable Energy Levels Push Down Electricity Prices Throughout Australia

Peak Renewable Energy Levels Push Down Electricity Prices

Peak levels of renewable energy push down electricity prices throughout Australia during the September quarter, driving down prices to zero or negative for ⅙ of the time, according to the latest report by the Australian Energy Market Operator.

Accordingly, wind, solar and hydro-derived electricity comprised nearly a third of the national electricity demand, setting a record at 31.7% and a riveting high of 61.4% for a brief period of time on 24 September.

Subsequently, the share of black coal fell to just under half for the first time ever in a September quarter, whereas the gas share withdrew compared to last year as well.

Australia’s electricity industry is the nation’s leading force in the decarbonizing process. Although its contributions are still about a third of Australia’s carbon emissions, the power sector is the driving cause of the positive forecasts that Australia is likely going to exceed the Paris agreement climate pledge to reduce emissions by 26% to 28% from 2005 to 2030. 

Violette Mouchaileh, chief markets officer over at AEMO, said that power prices in the mainland (which serve around 75% of Australia’s population) amounted to an average of $111 per megawatt-hour before plummeting down to an average of $37MWh in September.

Despite the staggeringly high prices of solar systems ($8,885 for an average 6kW LG solar system), Australian citizens are still choosing solar over traditional electricity sources. 

Australia is one of the top 10 countries in the world for total solar capacity in megawatts, with a total of 9,763 MW a few years ago, but no less than 35,690 MW recorded in 2020.

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