Australian coal use hits record low

 From The Age

Coal-fired power consumption in Australia hit a record low [i.e., since the formation of the national electricity market 25 years ago] during the first three months of 2021 and gas generation crashed to the lowest level in 15 years, as renewable energy and falling prices continue to shake up the market.

Figures from the Australian Energy Regulator, released on Monday, shed light on the impact of the clean energy transition sweeping the country’s main power grid and the existential challenges engulfing fossil-fuel generators.

Coal generation for the quarter dropped by 800MW, accounting for just 15,000MW: its lowest proportion since the formation of the National Electricity Market in the late 1990s.

During the past March quarter, usually the most energy-intensive period, the development of large wind and solar farms, greater output from rooftop solar panels and milder-than-usual weather [thanks to La Niña] slashed prices across the National Electricity Market. The Victorian wholesale price fell the most sharply, to $27 a megawatt-hour from more than $100 the same time last year.

“In summer, and particularly the first quarter, wholesale electricity prices are usually higher with hot weather prompting more use of air conditioners, and higher demand for electricity pushing up prices,” Australian Energy Regulator chair Claire Savage said. “But the first quarter this year was different.”

Rock-bottom wholesale electricity prices – which Ms Savage described as “good news for consumers” because they would eventually translate to lower bills – have been piling enormous pressure on coal-fired generators, which supply the bulk of the country’s power but are now running at a loss and are unable to compete with cheaper renewables during the day.

The chair of the Commonwealth’s Energy Security Board, Kerry Schott, last month said “the economics of coal is that nobody will build it” and the expected end of the life spans of existing plants were approaching faster than anyone had previously anticipated.

(Source of charts below: AER.  Solar chart excludes rooftop solar which is now 3 GW of capacity nationally compared with 5 GW of grid-scale solar.   Including rooftop solar, South Australia must be at ~60% total wind and solar in the latest data)

Solar as % of regional output

Wind as % of regional output