Wholesale electricity prices this week in Queensland have fallen below $30/MWh – see graph below – far below the levels of other states as mild weather and sunny condition reduced demand and generated a large amount of solar electricity.
The fall in energy prices came as Abbott blamed renewable energy for lifting retail electricity bills. On Tuesday, Queensland electricity prices did indeed rise 18 per cent, but this was almost entirely the result of soaring network costs and rising gas prices. The impact of renewable energy on retail prices actually fell.
Abbott’s comments came despite the conclusion of his own hand-picked modellers, ACIL Allen, which said the renewable energy target would lower consumer bills over the medium to long term.
This confirms conclusions reached by other analysis, despite the fact that the numbers dialled into the modeling by ACIL Allen were “fossil fuel” friendly and did not reflect the real cost of renewables.
This graph of Queensland demand and prices on Monday and Tuesday from the Australian Energy Market Operator illustrates the problem for coal and gas generators. The middle of the day was when the fossil fuel generators used to generate most revenue, because demand was highest. Now, demand eases dramatically, as this graph shows. Demand is in the green, while the wholesale price in is the red line.
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