Thursday Feb 02, 2023

Qld, NSW face second electricity crunch


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The federal government is optimistic blackouts can be avoided, even as millions of Queenslanders and NSW residents are again warned of a forecast electricity shortfall.

Households and businesses in NSW and in Queensland’s south-east and coastal areas were again asked to conserve power on Tuesday, amid warnings of potential blackouts from 5-9pm.

But Energy Minister Chris Bowen said further blackouts and load shedding could be avoided – although he predicted a difficult period throughout winter.

“We will be in for a bumpy period, there is no doubt about that,” he told the Seven Network on Tuesday.

“We are working very hard to avoid any blackouts and load shedding, we have done that so far.”

The Australian Energy Market Operator has asked generators to supply more electricity, saying it will order them to do so if needed.

“AEMO has not yet estimated the latest time at which they would need to intervene,” it said in a statement on Tuesday.

It would be the second consecutive night that AEMO has directed generators to fire up their power plants to maintain supply.

AEMO said on Tuesday it had again enforced price caps in both states, as well as Victoria and South Australia.

“This is due to wholesale electricity prices reaching the cumulative high price threshold, triggering a $300 megawatt hour price cap under the National Electricity Law and the National Electricity Rules,” it said.

Transmission company Powerlink’s chief executive Paul Simshauser SAID people should “be a bit thoughtful” and reduce energy use on Tuesday night.

“If you’ve got your air-conditioner on … just make sure it’s not set to blast furnace mode,” he told ABC Radio.

Queensland and NSW have faced energy supply crunches since Sunday, when electricity generators stopped offering to supply power after AEMO capped skyrocketing wholesale electricity prices.

AEMO said supplies remained low even though there was “sufficient physical generation capacity” in the both states.

“As a consequence [of the cap], some generators revised their market availability in NSW and Queensland for today,” it said.

“This has contributed to forecast supply shortfalls, along with generation units being offline for planned maintenance and repairs.”

Queensland Energy Minister Mick de Brenni said he did not need to intervene because AEMO was taking care of the situation.

“This is a system design that is doing its job at the moment, which means power stays on, we’ve got adequate supply,” he told ABC Radio on Tuesday.

He blamed the electricity crisis on higher demand due to cold weather, high gas prices because of the Ukraine war and maintenance outages at public-owned coal power plants.

Some of those plants will be back generating electricity by Thursday, Mr de Brenni said. Some will remain out of action until next April.

Wholesale electricity prices are set by the highest bidder in Queensland, and 83 per cent of power comes from coal and gas plants.

Queensland household electricity bills are set to rise by at least $43 per month from July. Analysts predict they will rise again before mid-2023 if wholesale prices continue surging to record levels.

Instead of dousing wholesale prices, the state government will wipe $43 from monthly power bills until mid-2023.

Mr de Brenni said investing more in solar and wind farms, and electricity storage, would shield Queenslanders from future blackouts in the longer term.

Mr Bowen said he expected the market operator to intervene if required to keep the power running.

“Coal-fired power is really under huge pressure at the moment … and that has led to some of the pressure on the system,” he said.

“This is a cycle of events, some of which are predictable. We know some of the outages that are coming. Some of them are unpredictable, particularly with an ageing fleet.”

He said everything was on the table in terms of reform in the sector. However, Mr Bowen admitted there was no easy solution.

“This is not a short-term fix. There’s no legislative basis at the moment, we would need to look very carefully,” he said.

“While this is a very serious situation, we’ll deal with it calmly and methodically.”

-with AAP





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