The Australian Energy Market Operator (AEMO) has suspended the spot market in all regions of the National Electricity Market (NEM) from 14:05 AEST 15 June, under the National Electricity Rules (NER).
The spot market is the mechanism that AEMO uses to match the supply of electricity from power stations with real time consumption by households and businesses.
AEMO has taken this step because it has become impossible to continue operating the spot market while ensuring a supply of electricity for consumers.
The market operator will apply a pre-determined suspension pricing schedule for each NEM region. A compensation regime applies for eligible generators who bid into the market during suspension price periods.
AEMO CEO, Daniel Westerman, said the market operator was forced to direct 5 gigawatts of generation through direct interventions on 14 June.
‘In the current situation, suspending the market is the best way to ensure a reliable supply of electricity for Australian homes and businesses,’ Mr Westerman said. ‘The situation in recent days has posed challenges to the entire energy industry, and suspending the market would simplify operations during the significant outages across the energy supply chain.
The market suspension is temporary and will be reviewed daily for each NEM region. When conditions change, AEMO will resume operating the market under normal rules as soon as practical.
The current energy challenge in eastern Australia is the result of several factors across the interconnected gas and electricity markets. Factors include:
- planned transmission outages
- periods of low wind and solar output
- around 3000 MW of coal fired generation out of action through unplanned events
- early and severe onset of winter increasing demand for both electricity and gas.
AEMO announcement AEMO
Minister’s Statement on National Electricity Market Australian Government