Authorities say there has been a drop in wholesale prices across the National Electricity Market (NEM).

The Australian Energy Regulator (AER) says that in the fourth quarter of 2019, average wholesale prices were between 10 and 20 per cent lower year on year and ranged from $65 per MWh in Queensland to $87 per MWh in South Australia.

“These figures show that for the first time in two years, since Q4 2017, average prices in all NEM states were below $90 per MWh. This is good to see after a period of sustained high prices,” AER chair Clare Savage said.

“There were some high price events late in the quarter during periods of extreme heat across the south-east of the country. We are investigating these events and will be releasing our reports into those soon,” said Ms Savage.

The extreme heat late in the quarter coupled with the unavailability of some generation plants, particularly in Victoria, had given rise to concerns that there would not be enough generation to ensure reliable electricity supply.

“The report demonstrates that the NEM coped well under the pressure of combined extreme weather and generation plant problems later in the year,” Ms Savage said.

“Generator outages were progressively resolved, meaning there were no actual reserve shortfalls in the quarter and reserve contracts were only dispatched once.”

Downstream wholesale gas prices continued to trend down, with prices falling for the fourth consecutive quarter to below $8/GJ in Victoria and Sydney.

Quarterly gas production was at record levels at Roma, Queensland, coinciding with record Queensland LNG exports despite falling Asian LNG spot prices.