The federal government is optimistic blackouts can be avoided, even as millions of Australians in five states face forecast potential power shortfalls within hours.
Households and businesses in New South Wales and in Queensland’s south-east and coastal areas were again asked to conserve electricity on Tuesday, amid warnings of potential blackouts from 5-9pm.
Queensland is expected to be short of power from 4.30pm until midnight and NSW from 5pm to midnight.
Potential power interruptions are also forecast for Tasmania and South Australia between 6.30 and 7.30pm. The Australian Energy Market Operator (AEMO) had earlier issued a “blackout” warning for Victoria as well, but cancelled the alert at 4pm on Tuesday after seeking a market response.
AEMO said on Tuesday it had again enforced price caps in NSW and Queensland, and extended them to Victoria and South Australia.
Energy Minister Chris Bowen said further blackouts and load shedding could be avoided – although he predicted a difficult winter ahead.
“We will be in for a bumpy period, there is no doubt about that,” he told the Seven Network on Tuesday.
“We are working very hard to avoid any blackouts and load shedding, we have done that so far.”
Prime Minister Anthony Albanese laid the blame for the east coast energy crisis firmly at the feet of the previous government, criticising Coalition “inaction”.
He said AEMO would intervene as much as necessary to keep the system functioning during winter, but the issues had been brewing over a longer period.
“You’ve had a decade of neglect where we have an energy grid that isn’t fit for purpose for the 21st century,” he said in Brisbane.
“What we find is that the consequences of the former government’s failure to put in place an energy policy is being felt right now with problems in the marketplace because that certainty wasn’t available.”
AEMO has asked generators to supply more electricity, and will order them to do so if necessary. It is the second consecutive night that AEMO has directed generators to fire up power plants to maintain supply.
AEMO has also enforced price caps down the eastern seaboard.
“This is due to wholesale electricity prices reaching the cumulative high price threshold, triggering a $300 megawatt hour price cap under the National Electricity Law and the National Electricity Rules,” it said.
Transmission company Powerlink’s chief executive Paul Simshauser SAID people should “be a bit thoughtful” and reduce energy use on Tuesday night.
“If you’ve got your air-conditioner on … just make sure it’s not set to blast furnace mode,” he told ABC Radio.
Queensland and NSW have faced energy crunches since Sunday, when electricity generators stopped offering to supply power after AEMO capped skyrocketing wholesale electricity prices.
AEMO said supplies remained low even though there was “sufficient physical generation capacity” in the both states.
“As a consequence [of the cap], some generators revised their market availability in NSW and Queensland for today,” it said.
“This has contributed to forecast supply shortfalls, along with generation units being offline for planned maintenance and repairs.”
Queensland Energy Minister Mick de Brenni said he did not need to intervene because AEMO was taking care of the situation.
“This is a system design that is doing its job at the moment, which means power stays on, we’ve got adequate supply,” he told ABC Radio on Tuesday.
He blamed the electricity crisis on higher demand due to cold weather, high gas prices because of the Ukraine war and maintenance outages at public-owned coal power plants.
Some of those plants will be back generating electricity by Thursday, Mr de Brenni said. Some will remain out of action until next April.
Wholesale electricity prices are set by the highest bidder in Queensland, and 83 per cent of power comes from coal and gas plants.
Queensland household electricity bills are set to rise by at least $43 per month from July. Analysts predict they will rise again before mid-2023 if wholesale prices continue surging to record levels.
In NSW, Treasurer and Energy Minister Matt Kean said there was enough reserve capacity, but did not specify how much and for how long it would last if the cold snap continued.
“There’s huge challenges in the energy sector at the moment”, he said on Tuesday.
“Obviously there’s … not a lot of slack in the system but the market operator who runs the system, they’re directing our plant to make sure that we don’t have any outages at this stage.”
Mr Bowen said he expected the market operator to intervene if required to keep the power running.
“Coal-fired power is really under huge pressure at the moment … and that has led to some of the pressure on the system,” he said.
“This is a cycle of events, some of which are predictable. We know some of the outages that are coming. Some of them are unpredictable, particularly with an ageing fleet.”
Mr Bowen said Australians could expect a “bumpy winter”, but people should not need to turn off their heaters.
“Nobody is asking for that to happen,” he said.
But he suggested Australians look at turning off equipment such as swimming pool heaters and outside lighting.
He said everything was on the table in terms of reform in the sector – although there was no easy solution.
“This is not a short-term fix. There’s no legislative basis at the moment, we would need to look very carefully,” he said.
“While this is a very serious situation, we’ll deal with it calmly and methodically.”