Each month, Watt Utilities publishes this Commercial Energy Market Report to keep our clients informed about wholesale electricity price movements across Australia’s east coast. We cover what happened in the spot market, why prices moved, and what it means for businesses managing energy costs. A new edition is released around the 20th of the following month.
Australia’s electricity grid operates through the National Electricity Market (NEM), which connects Queensland, New South Wales, Victoria and South Australia via a shared transmission network. Wholesale spot prices are set every five minutes through a competitive bidding process managed by AEMO (the Australian Energy Market Operator), the independent body responsible for operating the NEM and ensuring reliable electricity supply. The prices in this report reflect the wholesale spot market and are distinct from the retail rates businesses pay on their energy bills, though sustained movements in the spot market generally feed into retail contract pricing over time. This report covers the mainland NEM only (Queensland, New South Wales, Victoria and South Australia).
October 2025 delivered mild pricing across the mainland NEM despite multiple coal plant outages and interconnector constraints. Queensland recorded the lowest mainland average at $55.66/MWh, while all regions experienced minimal high-price intervals above $1,000/MWh. Strong renewable generation and mild spring temperatures created favourable supply conditions that prevented volatility despite several planned and unplanned thermal outages. Forward contract markets saw upward pressure as participants continued pricing in declining thermal reliability and summer demand risk ahead of the warmer months.
Source: Shell Energy / AEMO
| State | Average Spot Price | Max 5 Min Spot Price | 5 Min Intervals at $1,000+ | 5 Min Intervals at $0 or Below |
|---|---|---|---|---|
| QLD | $55.66 | $1,000.00 | 1 | 2,859 |
| NSW | $77.02 | $20,300.00 | 4 | 2,275 |
| VIC | $51.37 | $550.89 | 0 | 3,704 |
| SA | $50.17 | $1,001.00 | 1 | 4,074 |
Source: NEM Spot Market, AEMO (via Shell Energy Market Summary Report, October 2025)
Source: NEM Spot Market, AEMO. Chart Credit: Shell Energy. Historical data prior to Sep 2025 sourced from Shell Energy 3-year charts.
Calendar Year 2026 forward prices saw upward pressure through October despite benign spot outcomes, with market participants focused on summer demand risk and declining thermal reliability rather than current conditions. Victoria’s forward curve carried a premium reflecting ongoing coal generation concerns. For businesses with renewals approaching in the first half of 2026, the gap between current spot pricing and forward contract levels is notable. Those entering the market now are pricing in the risk of a hot summer and further thermal outages rather than locking in the relatively low spot rates seen through October. Businesses with flexibility to wait until after the summer period passes may find that forward prices ease if the season proves manageable. Those with near-term renewals have limited runway and should engage the market sooner rather than later.
Average pricing increased to $77.02/MWh in October, up 8.1% from September’s $71.24/MWh. Four high-price intervals above $1,000/MWh were recorded, with the maximum five-minute interval reaching $20,300/MWh.
NSW recorded four high-price intervals above $1,000/MWh, with a maximum of $20,300/MWh. The $20,300/MWh figure is AEMO’s administered price cap, a ceiling applied automatically when cumulative spot prices reach a regulatory threshold (it is not a data error). AEMO issued multiple system strength directions on 5 October and again on 29 and 30 October, highlighting tightening synchronous generation margins across the state.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202510)
Spot pricing averaged $55.66/MWh in October, up 2.4% from September’s $54.35/MWh. Queensland maintained the lowest mainland average for the month and set a new October demand record despite the subdued price environment.
Queensland recorded just one high-price event above $1,000/MWh during October. Units at Callide Power Station tripped following severe thunderstorms, causing frequency drops, but strong solar generation and improved wind conditions combined with mild temperatures to maintain stable pricing. The state recorded 2,859 zero or negative pricing intervals.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202510)
Average pricing reached $50.17/MWh in October, a 12.9% decrease from September’s $57.60/MWh and the largest fall among mainland states. The state recorded 4,074 intervals at or below zero pricing, the highest count across the mainland NEM.
SA recorded one high-price interval reaching $1,001.00/MWh during a brief wind lull. The month demonstrated the characteristic extremes of SA’s renewable-heavy generation mix, with extended oversupply periods producing the highest zero-price interval count on the mainland alongside isolated brief shortfalls when wind dropped. Renewable oversupply dominated daytime hours throughout October.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202510)
Spot pricing averaged $51.37/MWh in October, a 7.1% decrease from September’s $55.27/MWh. Zero high-price intervals above $1,000/MWh were recorded despite the Basslink outage and AEMO intervention requirements during the month.
Victoria recorded 3,704 zero or negative pricing intervals as renewable generation performed well through the spring period. A Basslink outage removed the ability to import energy during low wind periods, contributing to some elevated midday prices on affected days. AEMO issued non-credible contingency event directions on 15 and 16 October for synchronous generation support requirements.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202510)
Source: Shell Energy Market Summary Report, October 2025 (AEMO fuel mix data)
Coal held 56% of NEM output over the 90-day period to October (black coal 42%, brown coal 14%). Wind (22%) and solar (10%) combined for 32%, matching winter coal levels in renewable contribution as improved spring conditions lifted output. Hydro contributed 7% and gas 4%. The seasonal shift into spring is visible in the stronger wind and solar performance, with the resulting oversupply periods driving the elevated zero and negative pricing interval counts recorded across all mainland states.
Michelle Sims has joined the Watt Utilities energy management team, transitioning from her office administrator role within the business. Michelle brings valuable strata management experience from her previous work directly in the strata sector, giving her first-hand understanding of the unique energy challenges facing body corporate committees, from embedded networks to managing common area electricity costs.
With strata properties facing increasingly complex energy procurement decisions and growing adoption of solar systems in multi-unit developments, Michelle’s background positions her to provide practical advice tailored to strata governance and budgeting requirements. Our Watts Mine platform, which has incorporated AI-driven analysis for over two years, supports her work with detailed portfolio and market intelligence for strata clients.
The Australian Energy Market Commission reaffirmed its support for the Wholesale Demand Response Mechanism, ensuring the scheme remains a core feature of the national electricity market. Since its 2021 launch, the mechanism has delivered an estimated $4.7 million in wholesale market benefits at relatively low operating costs. Commercial and industrial businesses retain continued opportunities to earn revenue by reducing electricity use during peak periods, supporting grid stability while applying downward pressure on overall market prices.
Source: AEMC, October 2025
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