Thousands of homes on Australia’s east coast were plunged into darkness on Monday as electricity suppliers struggled to meet demand as the country teeters on the edge of an energy shortage.
On Monday night, multiple areas in Sydney’s north and along the affluent Northern Beaches were sent into darkness, after the energy market operator warned of power disruption across the states of New South Wales and Queensland.
Affected suburbs include Beacon Hill, Frenchs Forest, Narraweena, Cromer and Dee Why in New South Wales (NSW), according to Ausgrid—Australia’s largest electricity distributor on the east coast. Power was available later in the day.
Households were encouraged to use less power as leading energy provider Powerlink Queensland warned of an “unusual combination” of unexpected generator outages plus cool winter temperatures and high demand for electricity.
“Gas supplies are sufficient however very high gas prices means [the Australian Energy Market Operator] has already triggered its market generation response mechanisms,” Powerlink said in a statement on Monday.
Meanwhile, the Australian Energy Market Operator (AEMO) on Tuesday confirmed that some energy generators have “revised their market availability” in NSW and Queensland due to a new $300/MWh price cap, a result of increased wholesale electricity prices.
In the gas markets, gas prices remained capped at $40/GJ after reaching cumulative high price thresholds in Victoria and Sydney.
“As a consequence of the administered price cap in Queensland, AEMO has seen generation bids reduce,” AEMO said in a media release on Monday.
“The price cap … will only remain in place if the cumulative price threshold is still exceeded.”
“It is possible that other states may also reach the threshold in the near term.”
A spokesperson for the Australian Energy Council, which represents major power generators including AGL, EnergyAustralia and Origin, said its members faced a “complex issue” but were seeking solutions to the power crunch, as they battle coal prices that are soaring because of sanctions on Russian exports..
“The price cap unintentionally means that some plants can’t recover their fuel costs. Participants are legitimately seeking ways to resolve the problem,” the spokesperson said.
The power outages came as former Prime Minister Malcolm Turnbull urged the current federal Labor government to work with the states and National Energy Market to impose export controls on gas and limit prices for a 90-day period.
Turnbull said this would push major LNG producers to concede and make cheaper gas available.
“This will involve imposing force majeure on contracts,” he told ABC Radio on Monday.
“It’ll be resented bitterly by the industry … but we have a crisis at the moment, and hopefully, it won’t go on for too long.
“The minute they say they’re going to do it, the gas companies will find the gas … they will agree to offer it at lower prices.”
In Queensland, households were also warned of possible power outages between 5.30p.m. to 8p.m. on Monday, but these were averted.
Powerlink Queensland encouraged households to save energy including suggestions to consider how much heating was being used, turn off or place into standby electronics like TVs, computers, and household appliances, and to also switch-off pool pumps.
Businesses were told to consider their use of indoor and outdoor lighting and to turn off water heating systems.
“By carefully managing electricity use at home and in your workplace, the community can help ensure that power system security is maintained in Queensland,” Powerlink CEO Paul Simshauser said.