Renewables Surge as Coal States Face Outages & Price Spikes

The Australian Energy Market Operator (AEMO) reports a historic shift in the nation’s electricity grid, with renewables hitting record highs while coal-dependent states struggle with outages and soaring prices.

Coal Generation Falls Below 50% for the First Time

Unplanned coal plant outages and declining availability led to the lowest coal share in NEM history.

Renewables Hit a Record 46% Share

Peaked at 75.6% on November 6.

Rooftop solar helped reduce grid demand, despite a 2.4% rise in underlying electricity demand due to heatwaves.

Price Disparities: Coal vs. Renewables

NSW & Queensland (coal-heavy): Highest wholesale prices at $143/MWh & $127/MWh due to plant failures and transmission limits.

Victoria & South Australia (renewables-driven): Lowest prices at $45/MWh & $52/MWh.

Coal Outages Drive Price Spikes

November 7: 5 GW of coal capacity offline, pushing prices to extreme levels.

November 27: Coal & gas failures sent prices to the market cap of $17,500/MWh.

Negative Pricing at Record Levels

23.1% of the time in NEM, with South Australia leading at 38%.

Caused by excess supply, weak transmission, and inflexible coal generation.

Western Australia’s Shift to Batteries & Solar

Coal generation fell 19.5%, replaced by rooftop solar (+20.3%) and battery storage.

Renewables peaked at 85.1%, with battery capacity set to quadruple in two years.

AEMO stresses the urgency of new transmission projects (VNI West, Project EnergyConnect, HumeLink).

Federal government supports renewables & transmission, while opposition parties push for coal extensions and costly nuclear power.

NEM emissions hit record lows:

24.9 million tonnes CO2-e (down 1.7% from Q4 2023).

Emissions intensity at 0.57 tCO2-e/MWh (down 3.2%).

Gas demand falls as electrification expands across homes and industries.

The decline of coal, rise of renewables, and expansion of battery storage are reshaping Australia’s electricity grid. With more transmission and storage projects underway, the market is moving towards cheaper, cleaner, and more reliable energy—but policy battles remain critical in shaping the transition.

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