Renewables penetration pushes Australian power prices down in Q2 – AEMO

Facebook
Twitter
LinkedIn
Reddit
Email
AEMO has previously said that greater, consistent investment in renewables is needed to ensure reliable power supply as coal plants go offline. Credit: Mytilineos

Increased solar PV and wind generation contributed to lower wholesale electricity prices in Australia in Q2 2023, according to the Australian Energy Market Operator (AEMO).

From April to June, wholesale prices averaged AU$108/MWh (US$71) and prices exceeded AU$300 (US$199) at just 3% of time intervals, as compared with 26% in the equivalent period of 2022. However, the average price was 31% higher than in Q1.

This article requires Premium SubscriptionBasic (FREE) Subscription

Try Premium for just $1

  • Full premium access for the first month at only $1
  • Converts to an annual rate after 30 days unless cancelled
  • Cancel anytime during the trial period
  • Expert industry analysis and interviews
  • Digital access to PV Tech Power journal
  • Exclusive event discounts

Or continue reading this article for free

By state, the highest quarterly average price was AU$137/MWh (US$91) in New South Wales; the lowest was AU$64/MWh (US$42) in Tasmania.

“Increased market share of lower marginal-cost renewables helped push down the wholesale electricity cost from Q2 2022, despite this quarter having the highest Q2 underlying demand recorded since 2016,” said Violette Mouchaileh, executive general manager reform delivery at AEMO.

“Rooftop solar generation increased 30% from Q2 2022, which reduced electricity demand from the grid. Coupled with higher renewable output, wholesale prices were zero or negative 9% of the quarter throughout the NEM, a new Q2 record,” she said.

According to Australia’s Clean Energy Council, rooftop solar generation surpassed all other power generation sources last over the 2022/23 summer – 8,046GWh, 14% of the country’s overall energy consumption. March saw the national rooftop capacity surpass 20GW, according to industry consultancy SunWiz.

More broadly, the government announced its latest federal budget in May, committing AU$4 billion (US$2.6 billion) in new investment to renewables.

“In addition to increased wind and grid-scale solar output, lower thermal-coal costs and a net increase in black-coal generation availability in NSW – despite the retirement of the Liddell Power Station – helped reduce year-on-year wholesale prices,” said Mouchaileh.

AEMO said in March that, despite impressive investment into renewables in the latter portion of 2022, the plans for retiring coal plants will cause every mainland state to fall below the requisite supply reliability standard unless ‘timely and determined’ efforts were made to increase the penetration of alternative power sources. The standard requires that 99.998% of forecast consumer demand is met.

In May’s budget, AU$2 billion (US$1.3 billion) was designated for developing a green hydrogen economy, which could provide bulk renewable power for the country. Earlier this month a deal was signed for a 900MW solar PV project to power a green hydrogen and ammonia plant to be owned by the newly-founded Aboriginal Clean Energy (ACE) Partnership.

Read Next

September 3, 2025
Developers Alight Neoen have commissioned the 100MWp Hultsfred Solar Farm in Småland, southern Sweden.
September 3, 2025
US residential solar prices have remained at historic lows in the first half of the year despite market uncertainty and continued high interest rates.
September 3, 2025
India has added 2.8GW of rooftop solar in H1 2025, a 158% year-on-year surge from just 1.1GW in the same period last year.
September 3, 2025
Huasun claims it has set new record efficiencies for HJT-perovskite tandem solar cells at both laboratory and commercial scales.
September 3, 2025
Singapore-headquartered independent power producer Peak Energy has broken ground on a 65MWp solar project in Isabela, in the Cagayan Valley region of northeast Luzon, Philippines. 
September 2, 2025
Q Energy has reached financial close for Taurus B, a portfolio of seven solar PV plants in Spain with a combined capacity of 251.71MWp.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
September 16, 2025
Athens, Greece
Solar Media Events
September 30, 2025
Seattle, USA
Solar Media Events
October 1, 2025
London, UK
Solar Media Events
October 2, 2025
London,UK
Solar Media Events
October 7, 2025
Manila, Philippines