Paul was one of the founders of Global-Roam in February 2000. He is currently the CEO of the company and the principal author of WattClarity. Writing for WattClarity has become a natural extension of his work in understanding the electricity market, enabling him to lead the team in developing better software for clients.
Before co-founding the company, Paul worked as a Mechanical Engineer for the Queensland Electricity Commission in the early 1990s. He also gained international experience in Japan, the United States, Canada, the UK, and Argentina as part of his ES Cornwall Memorial Scholarship.
Worth a short note that (on the first official day of winter … though in temperature terms it started some weeks ago) they have published a Media Release ‘AEMO forecasts improved winter 2023 for Australia’s energy system, risks remain’ that…
While the NEM is a complex machine and it’s very rare that there’s ever a single ‘cause’ for any particular outcome, it could be argued that the systemic destruction of reliable coal fired power plants and removal of a material volume of dispatchable generation is the driver.
Notice how most of the price spikes are in the early evening, the head of the duck curve as it were, when solar (and to an extent wind) is less productive, and people are demanding power for cooking (and heating)
It might have been cold, but hardly peak load stuff. Cold overnight temperatures usually result in high daily energy, not necessarily load. (Dare I say the generators make some money!) What has changed is a not insignificant lump of relatively cheap SRMC generation (Liddell) removed from the market, so it all shuffles up the cost curve. Most energy in the NEM is (in reality) settled by bilateral trading arrangements – particularly so for the vertically integrated gentailers. Retailers in unhedged wholesale positions got scorched last winter you may recall. Now the energy served by Liddell is simply being supplied by more expensive sources on occasions when wind (and solar) are missing or the peak demand goes a bit higher and a higher cost generator bids in and settles the market. Your previous remarks about pricing when liquids appear highlight this. Nothing to see here – your new normal.
While the NEM is a complex machine and it’s very rare that there’s ever a single ‘cause’ for any particular outcome, it could be argued that the systemic destruction of reliable coal fired power plants and removal of a material volume of dispatchable generation is the driver.
Notice how most of the price spikes are in the early evening, the head of the duck curve as it were, when solar (and to an extent wind) is less productive, and people are demanding power for cooking (and heating)
It might have been cold, but hardly peak load stuff. Cold overnight temperatures usually result in high daily energy, not necessarily load. (Dare I say the generators make some money!) What has changed is a not insignificant lump of relatively cheap SRMC generation (Liddell) removed from the market, so it all shuffles up the cost curve. Most energy in the NEM is (in reality) settled by bilateral trading arrangements – particularly so for the vertically integrated gentailers. Retailers in unhedged wholesale positions got scorched last winter you may recall. Now the energy served by Liddell is simply being supplied by more expensive sources on occasions when wind (and solar) are missing or the peak demand goes a bit higher and a higher cost generator bids in and settles the market. Your previous remarks about pricing when liquids appear highlight this. Nothing to see here – your new normal.