The Australian Energy Regulator (AER) has published the State of the energy market 2024 report, which provides a comprehensive review of energy and gas markets over the past 12 months.
The report documents the end-to-end operation of Australia’s energy market and covers key trends and developments in the gas and electricity space.
According to the AER’s report, throughout 2024 wholesale electricity prices have eased from the extreme levels of 2022 but are increasingly volatile. Weather conditions and outages at both generator and network levels during high demand periods contributed to the volatility. The market experienced record low electricity demand in New South Wales, Victoria, South Australia and Tasmania, but also record high demand in Queensland.
The AER report also found that, collectively, consumers have become an even more integral part of the energy transition through their investment in rooftop solar, batteries and electric vehicles, with residential solar in the National Electricity Market (NEM) now exceeding 20GW – 2.9GW more than last year.
AER Chair, Clare Savage, said that with the sector changing so fast, the importance of efficiency in the energy system has never been more critical.
“We’re calling for a renewed focus on network utilisation and improved efficiency – for industry to look for ways to more effectively use the existing network before investing in new assets.
“Now is the time to get creative. Regulatory sandboxing tools such as the Energy Innovation Toolkit are available to allow for the trialling of innovative approaches to new products and services that will deliver greater choice and cheaper energy options for consumers.
“As technology evolves and the sector innovates, consumer protections must also be designed to support an energy system where consumers can use multiple energy services to consume, trade and produce energy. We’ve presented detailed analysis on this issue to energy ministers and look forward to seeing this progressed as part of the National Consumer Energy Resources Roadmap,” Ms Savage said.
Significant shifts have also been observed in gas markets. While gas will continue to play a role supporting electricity reliability and large industry for some time, the AER said it has observed further moves towards the electrification of domestic gases in the past 12 months.
Affordability and energy debt remained challenging for consumers. While the proportion of customers in debt has remained stable, the average amount of debt per customer increased in 2023–24. Rebate assistance from governments has helped offset energy price increases, however broader economic conditions have continued to impact consumers.
Alongside the State of the energy market report, the AER will continue to publish a range of in-depth reports into specific parts of the energy system in the coming months.
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