Key Points
- Several states were hit with energy shortfall warnings on Tuesday.
- Energy Minister Chris Bowen said regulators had stepped in and were confident major problems could be avoided.
Several states were hit with energy shortfall warnings on Tuesday as a power crisis continues to grip Australia's east coast.
The Australian Energy Market Operator (AEMO) said NSW, and households and businesses in Queensland's southeast and coastal areas, could face blackouts between 5.30pm and 9pm on Tuesday.
But following discussions with generators, it said there were "approximately 2,000 megawatts of generation" that it could order them to supply in order to meet forecast electricity shortfalls.
It also said that Tasmania, South Australia and Victoria could face power interruptions on Wednesday evening, but cancelled the warnings on Tuesday afternoon.
A perfect storm of coal-fired power station outages, high demand due to a cold snap, and problems in the global and domestic gas markets , but the federal government is confident Australia's east coast won't face blackouts.
Energy Minister Chris Bowen said regulators had stepped in and were confident major problems could be avoided.
"It has required AEMO to direct generators to bid into the market to provide the energy system with electricity," he said.
As well, some of the biggest energy users have reduced their demand.
"I do not believe there is a likely outcome at this point that there will be any requirement for load shedding, or indeed, as I said, for blackouts," Mr Bowen said
AMEO said in a statement on Tuesday morning it had rolled out price caps in Queensland, NSW, Victoria and South Australia due to wholesale electricity prices reaching a threshold.
As a result, some generators in NSW and Queensland revised their "market availability", which — in addition to coal plants being offline — contributed to forecast supply shortfalls on Tuesday evening.
NSW Treasurer Matt Kean was confident the state could avoid blackouts after meeting with AMEO boss Danny Westman on Tuesday morning. Mr Kean said he was told that there was enough power available “to ensure system reliability”, although the sector is facing "huge challenges".
Meanwhile, Queensland has been facing a supply crunch since Sunday when electricity generators stopped offering to supply power after AEMO capped skyrocketing wholesale electricity prices.
Supplies are low in Queensland even though there is "sufficient physical generation capacity" in the state, AMEO said.
Queensland Energy Minister Mick de Brenni says he doesn't need to intervene because AEMO is 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.
Victorian Energy Minister Lily D'Ambrosio blamed the scare on "strange behaviour" from power companies sitting on their reserves and not bidding into the market.
She said the generators are "potentially" gaming the system, a topic federal, state and territory energy ministers asked AEMO to investigate after .
"No one likes the situation we're seeing now," Ms D'Ambrosio told ABC Radio Melbourne.
"We've been told and assured by the market operator that there is more than sufficient power in Victoria available, it's just not being bid into the market."
