Operator warns of continuous blackouts

South Australia and Victoria will be the worst hit states, the Australian Energy Market Operator (AEMO) said in an annual study, Reuters reports.

Electricity shortages loom for South Australia, the state most reliant on wind and solar power since the latter half of 2023, while Victoria, the country’s second most populous state, will face it from the second half of 2024.

AEMO CEO Daniel Westerman said more investment in the national power grid was needed.

He warned that the current list of fully funded power projects did not have the generation capacity to cover future forecasts.

All states and territories except Western Australia and the Northern Territory are part of the National Electricity Market (NEM).

In June, Australia came close to blackouts when several coal plants suffered unexpected outages. Others suffered disruptions due to coal supply shortages, while soaring gasoline prices hit gas-fired generators.

“These circumstances have highlighted the need for the NEM to be resilient to external events such as extreme weather, fuel availability constraints and the impacts of high global commodity prices,” AEMO said in a statement.

Coal-fired power plant operators have reported that their plant reliability is unlikely to improve in the current fiscal year.

And while supply is under pressure due to the halt in coal generation, demand for electricity is expected to grow as industrial sites are set to ramp up production.

The operator activated the gas supply guarantee because reserves at the state’s Iona underground storage plant were depleted.

Power bills have skyrocketed in recent months due to gas and coal shortages, the war in Ukraine and a disparity in the speed of renewables being fed into the system.