The state’s wholesale power prices peaked at over $10,000 a megawatt-hour on Thursday morning, almost 140 times the average in the March quarter, and were forecast to top $15,000/MWh on Thursday evening. Gas prices passed $15.50 a gigajoule – almost double Monday’s level – with no easing expected until Saturday.
This has raised fresh fears about the reliability of energy supply in Victoria as huge coal power stations head for closure in the next few years. Just half of EnergyAustralia’s 1480-megawatt Yallourn generator has been offline this week, but the entire plant is due to be switched off in 2028. AGL Energy’s much larger Loy Yang A plant is scheduled for closure by 2035.
Central to the coal power disruptions is EnergyAustralia’s extended shutdown of one unit at Yallourn after the collapse of an air duct from a boiler last Sunday during repair work on a tube leak. The Mining and Energy Union said the incident raised questions about maintenance and safety standards at the state’s ageing coal stations.
A second unit at Yallourn returned to service around midnight on Wednesday but only ran for a few hours before shutting down again, noted Josh Stabler, managing director at adviser Energy Edge.
A unit at Loy Yang A is also out of action, as is one unit at AGL’s Bayswater generator in NSW and four coal units in Queensland.
In the three days since the Yallourn outages, Victoria has used about 743 terajoules of gas, according to Stabler, amid minimal generation from solar and wind farms during a run of cold, dull and low-wind days. The temperature in Melbourne fell to 6 degrees early Thursday and the mercury is forecast to sink to 4 degrees early Friday.
The gas usage over the past three days compares with the Australian Energy Market Operator’s base-case forecast that Victoria would use 5600 terajoules of gas for electricity generation for all of 2025. It is among the 10 highest instances of gas usage for power in the past 15 years, Stabler said.
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