Australian Electricity Grid Stability During Heatwave Supported by Solar Power

Overview of Market Performance

During a recent heatwave, with temperatures exceeding 40 degrees Celsius across southern Australia, the country's largest electricity market, the National Electricity Market (NEM), exhibited stable spot prices. The Australian Energy Market Operator (AEMO) issued minimal warnings regarding supply risks. Geoff Eldridge, an electrical engineer from Global Power Energy, observed that the system's response was notable for the absence of typical stress indicators during peak demand.

Shift in Grid Dynamics

Historically, high summer temperatures increased demand, particularly for air conditioning, placing continuous pressure on electricity supply. Eldridge noted that while demand approached record levels this week, the system demonstrated a different response compared to previous heatwaves, such as in 2019. There were no Lack of Reserve notices, no calls for emergency reserves, and prices largely remained stable throughout the middle of the day. This indicates a significant shift in Australia's energy transition, where solar power now manages a substantial portion of the heat-driven load during daylight hours.

Contribution of Renewable Energy

On Wednesday, solar power provided over 60% of the electricity consumed in the NEM at its peak, with approximately two-thirds originating from rooftop solar installations. When combined with wind and hydropower, renewable sources met up to 76.6% of demand on that day. Renewable energy contributed almost half of the total supply over the 24-hour period. This marks a significant increase from seven years prior, when renewables supplied less than 26% during a similar heatwave. Instances of