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Electricity rates update – March 2018

Electricity rates – Futures prices dropped in New South Wales, Queensland, South Australia, and Victoria from 1 March through to April 16.

The biggest drop was experienced in New South Wales with 5.6%, which was substantially higher than the other states under review.

South Australia followed with a drop of 1.2% and Queensland was not far behind with a drop of 1%. Victoria registered the smallest price decrease with 0.5%. The trend was established through the month of March and prices continued to slide in all states except Victoria with a slight increase of 0.25% in the first two weeks of April. The average drop in futures prices across the board was of 2.1% from 1 March to date. Prices are still up by between 13% and 81% when compared to 24 months ago.

All states average

Futures Price Movement since:Current Month to Date2 Months to Date3 Months to Date6 Months to Date12 Months to Date24 Months to Date
NSW – AverageDown 2.14%Down 5.62%Down 6.67%Down 8.34%Down 20.13%Up 43.77%
QLD – AverageDown 1.40%Down 1.04%Down 3.33%Down 4.84%Down 17.94%Up 13.21%
SA – AverageDown 0.28%Down 1.19%Down 1.44%Down 0.50%Down 16.41%Up 30.00%
VIC – AverageUp 0.25%Down 0.50%Down 0.55%Down 1.89%Down 12.66%Up 81.11%

Source: www.asxenergy.com.au

Note: The above electricity rates are based on the average of Calendar Year 2018, 2019, 2020 baseload futures prices.

Futures prices across Australia have been trending down since the new year and that has largely been attributed to the huge number of renewable energy projects that have already come on stream or are expected to later in the year.

The Council of Australian Governments Energy Ministers will also be convening for a meeting by the end of April to discuss the introduction of the Federal Government’s National Energy Guarantee.

South Australia’s residents voted Jay Weatherill’s Labor Party out of office and have replaced it with the Liberal party led by Premier Steven Marshall. The new SA government has signalled that it will support the NEG if it gets an energy interconnector to New South Wales.

Other big news is that the New South Wales government has given the thumbs up to what will become the biggest commercial wind farm in Australia.

Also in New South Wales, AGL Energy is sticking to its guns with plans to shut down the coal-fired Liddell power station and turn it into a renewable energy hub. Energy Australia has also gone on record saying that coal is on the way out and it will not be investing in any new coal-fired ventures.

New South Wales electricity rates

Futures Price Movement since:Current Month to Date2 Months to Date3 Months to Date6 Months to Date12 Months to Date24 Months to Date
NSW – AverageDown 2.14%Down 5.62%Down 6.67%Down 8.34%Down 20.13%Up 43.77%

Wholesale futures prices in New South Wales dropped in March (to date) by an average of 5.6%. The downward trend continued from February when a drop of 4.2% was registered, but prices are still 44% higher than what they were in 2016.

This is reflected in the rates that are currently being offered by retailers to large market electricity customers in New South Wales.

The big news in New South Wales is that the state government has given planning approval for what will become Australia’s largest wind farm in the Liverpool Range in the Hunter Valley. When completed in three years time, it will provide enough electricity to provide power to 380,000 homes.

The continued boom of renewable energy projects in New South Wales is a contributing factor to the drop in futures prices.

More and more businesses are committing to 100% renewable energy to reduce their costs and to gain independence from the grid. The latest example in NSW is Sydney Markets.

Queensland electricity rates

Futures Price Movement since:Current Month to Date2 Months to Date3 Months to Date6 Months to Date12 Months to Date24 Months to Date
QLD – AverageDown 1.40%Down 1.04%Down 3.33%Down 4.84%Down 17.94%Up 13.21%

Wholesale futures prices in Queensland dropped in March (to date) by an average of 1%. The trend continued from February, when a drop of 2.62%% was registered. Futures prices are still 13% higher than what they were in 2016. This is reflected in the rates that are currently being offered by retailers to large market electricity customers in Queensland.

Things have been pretty quiet on the energy front in the sunshine state, with the last piece of major news coming February, when the switch for Australia’s first major solar battery facility connected to the national grid was flicked on.

Lakeland Solar and Storage, near Cooktown in the North of Queensland, will provide power to 3,000 homes and businesses on the Cape York Peninsula, some 240 kilometres north west of Cairns.

South Australia electricity rates

Futures Price Movement since:Current Month to Date2 Months to Date3 Months to Date6 Months to Date12 Months to Date24 Months to Date
SA – AverageDown 0.28%Down 1.19%Down 1.44%Down 0.50%Down 16.41%Up 30.00%

Wholesale futures prices in South Australia dropped by 1.2% in March (to date), continuing the trend established in February when futures prices dropped by 2.7%. Futures prices are still 30% higher than what they were in 2016. This is reflected in the rates that are currently being offered by retailers to large market electricity customers in South Australia.

South Australia continues to find itself in the news, most notably after pro-renewable energy Premier Jay Weatherill was voted out of office. Mr Weatherill was the biggest opponent to the Federal Government’s National Energy Guarantee and incoming Liberal Premier Steven Marshall has signalled that he is willing to lend support if South Australia gets an energy interconnector to New South Wales.

French wind power experts Neoen French ar seeking planning approval to construct the world’s largest solar, wind, battery storage and hydrogen production superhub. The facility would be able to provide power to 18 percent of the state’s households for four hours in a blackout.

Victoria electricity rates

Futures Price Movement since:Current Month to Date2 Months to Date3 Months to Date6 Months to Date12 Months to Date24 Months to Date
VIC – AverageUp 0.25%Down 0.50%Down 0.55%Down 1.89%Down 12.66%Up 81.11%

Wholesale futures prices in Victoria dropped by half a percentage point in March, continuing the trend established in February when futures prices dropped by 1.39%. April has seen prices edge up by 0.25% (to date). Futures prices are still 81 % higher than what they were in 2016. This is reflected in the rates that are currently being offered by retailers to large market electricity customers in Victoria.

Victoria’s energy sector was quite active in March, with the biggest announcement being that the state government has enlisted tried and trusted Tesla and Fluence to build two new big battery installations.

Tesla will build a 25 MW – 50 MWh battery which will be hooked up to the 60 MW Gannawarra solar farm near Kerang. Fluence will build a 30 MW-30 MWh battery at the Ballarat terminal station which will be hooked up to the grid.

Australia’s biggest brewing company, Carlton & United Breweries, is aiming to reach a 100% renewables target by the end of the year after signing an exclusive solar energy contract to buy solar power from German renewable energy company BayWa’s 112 MW Karadoc solar farm in Victoria.

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