Australia’s main wholesale electricity market has been suspended by regulators in the latest sign that the crisis threatening the stability of energy supplies is deepening.
The Australian Energy Market Operator said in a statement on Wednesday it had halted trading in the spot market serving NSW, Queensland, Victoria, South Australia and Tasmania with effect from 2.05pm AEST.
“Aemo has determined that it is necessary to suspend the spot market in all regions [of the national electricity market] because it has become impossible to operate” the market within the rules, the regulator said.
In the hours prior to the suspension, Aemo had issued so-called lack of reserve alerts at the level 3 warning for all the mainland states within the market.
For NSW, the forecast supply gap reached as much as 4,000 megawatts for a period on Thursday afternoon, among five such warnings. By contrast, NSW’s total demand during Wednesday afternoon was about 6,100Mw.
The suspension came as Aemo and other members of the Energy Security Board – the energy market commission and the energy regulator – had an urgent meeting with generators to discuss supplies.
Both the commission and the regulator had in the past day reiterated the importance of generators providing supply to the tight market even with price caps of $300/Mw-hour now imposed on all five states.
Generators have denied they are gaming the market by withdrawing supply, saying the price caps had affected the profitability of some bids but they would follow orders if instructed to generate power to avoid blackouts.
The federal energy minister, Chris Bowen, has previously warned power generators that anyone using the current crisis to engage in market manipulation will face action from regulators wielding the “full force of their powers”.
More to follow …