Energy market suspension to be lifted

by | June 23, 2022 03:30 | News

The suspension of trading in the national energy market will be eased from Thursday morning, after the market operator indicated there would be enough capacity for homes and businesses.

Following a “clear improvement” in energy conditions, the Australian Energy Market Operator said it would begin a staged process where the market would go back to normal.

The system was destabilised last week, prompting the Australian Energy Market Operator to take control to stabilise power supplies.

The energy market will be able to start setting prices again from 4am on Thursday.

The market operator would then be able to completely lift the unprecedented trading suspension after monitoring conditions for 24 hours.

Market operator chief executive Daniel Westerman said there would be a step-by-step approach in lifting the suspension of the market.

He said there had been vast improvement to the market, with about 4000 megawatts of generation being returned to the energy grid after outages.

“That means the risk of any shortfall has reduced markedly,” Mr Westerman said.

“We know many generators are working hard and closely with governments to improve the confidence of their fuel supply, to ensure that they are able to operate at their desired level of output.”

The market operator said it expected the system used to schedule energy generation into the grid would be operating without failure.

This was due to a low volume of directions to generators and a reduction in forecast shortfalls of energy as electricity suppliers respond to market signals.

Australian Industry Group chief executive Innes Willox said the resumption of the national energy market was a sign of pressures easing in the sector.

However, he said the situation was far from normal.

“(This) is the first step on the road out of energy hell, and into purgatory, we could be here for a very long time,” he said.

“We are not back to normal and there is no basis for relaxation.”

Mr Willox said the market operator did what was necessary to keep the electricity grid running.

He indicated further unexpected events could worsen the situation for the energy market.

“More generators could break, winter has a long way to run, the war in Ukraine and the confrontation with Russia could cause even more intense problems for global energy markets,” he said.

“We need to stay ready for anything.”

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