Brave new grid

Yesterday as Australians were sitting down to eat their Sunday roast at lunchtime, a once unusual thing was happening in the National Electricity Market: the wholesale price of electricity in every state in the NEM went negative.

The cause was modest weekend demand combined with clear skies and ripping winds across the market. The extreme opposite of Dunkelflaute (dark and still) conditions which have been sending prices skyrocketing as Australia’s expanding fleet of renewable generators sit mostly idle.

The Australian Energy Market Operator’s (AEMO) dispatch centre was in overdrive all day trying to keep enough firm capacity on in states like South Australia to supply ancillary services while shifting the constantly surging oversupply of electricity around the country to minimise price disruptions.

Market analysts WattClarity estimate at least 10 gigawatts of renewables were supplied from wind farms, large scale and rooftop solar PV across the NEM, nearly half of the 22GW of NEM demand.

Conditions were most extreme in South Australia, of course, where afternoon demand of around 1600MW was not enough to soak up the state’s renewable generation that hovered around 1700MW for most of the afternoon.

South Australia generation and price 17-20 July 2020 Source: OpenNEM

To maintain power quality (frequency services, system strength and inertia) AEMO required an additional 280MW of gas generation to stay on, producing generation surpluses of around 500MW.

Normally this extra power could be sent into Victoria, except that Victoria was trying to manage its own 2700MW of renewable generation by pushing its brown coal generators as low as they could go and shipping its surplus of more than 800MW into New South Wales and Tasmania.

Victorian generation and price 17-20 July 2020 Source: OpenNEM

The NSW grid was also enjoying a renewable surge of around 2600MW, but managed to get its coal generators low enough to absorb its share of Victoria’s surplus. The Basslink to Tasmania was basically full all afternoon as the state’s hydro generators wound right back to let imported and local renewables supply two-thirds of its demand.

Tasmania generationa nd price 17-20 July 2020 Source: OpenNEM

Not to be outdone, mild and sunny conditions in Queensland delivered another 2400MW of solar generation, offloading around 500MW to NSW and 240MW into the Wivenhoe pumped hydro storage.

The good news is the NEM is able to manage, and utilise, the scale of installed renewable capacity, although the coincidence of negative prices suggests that the system, as currently configured, is approaching its capacity to absorb much more intermittent generation without starting to force large coal generators to switch off. And that. of course, is the beginning of the end for them.

One of the four units at Yallourn in Victoria and Liddell in NSW were off line yesterday, while three of the six units at Gladstone in Queensland were also off.  Apart from the gas kept on by AEMO in South Australia, almost no gas generation was operating across the NEM. Gas and renewables are more complementary than coal and renewables.

Negative prices aren’t great for any generators running yesterday, but particularly those renewables exposed to the spot price.

The challenge of these big green days is something we are going to have to get used to as thousands of megawatts of small and large scale generation capacity continue to enter the market.