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).
March 2025 saw spot prices ease in Victoria and South Australia while Queensland reversed February’s dip with a 5.5% recovery. New South Wales held nearly flat, down just 0.4% from February, despite a major price spike on 15 March when demand exceeded 12,000 MW and the peak five-minute interval reached $17,480/MWh. Victoria and South Australia both recorded frequent negative pricing due to strong renewable generation and lower autumn demand. Forward contract prices rose modestly as cap events in QLD and NSW increased short-term market risk heading into the cooler 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 | $79.01 | N/A | Multiple | N/A |
| NSW | $89.96 | $17,480.00 | Multiple | N/A |
| VIC | $61.75 | N/A | 0 | 1,786 |
| SA | $61.79 | N/A | 0 | N/A |
Source: NEM Spot Market, AEMO (via Shell Energy Market Summary Report, March 2025). Note: The March 2025 source report used an earlier format without a complete spot price statistics table. Max 5 Min Spot Price and interval counts are partially available only.
Source: NEM Spot Market, AEMO. Chart Credit: Shell Energy. Historical data prior to Sep 2025 sourced from Shell Energy 3-year charts.
Forward contract prices rose slightly through March as markets absorbed the Q1 cap events in QLD and NSW and priced in the increased likelihood of volatility heading into the cooler months. For businesses with renewals approaching in the middle of 2025, March represented a moderately settled environment relative to what followed in subsequent months. The modest upward movement in FY2026 contracts reflected a market beginning to price in winter supply risk, but without the urgency that would emerge in May and June as thermal outages and wind shortfalls created acute supply tightness. Businesses that locked in contracts through March were entering at levels that proved more attractive than the July 2025 post-event perspective, though the forward curve at the time gave limited visibility of how severe Q2 conditions would become.
Spot price averaged $89.96/MWh in March, down just 0.4% from February’s $90.33/MWh. The near-flat average masked a single sharp demand event on March 15, when the daily average reached $392.13/MWh following demand exceeding 12,000 MW.
A major price spike on March 15 was driven by demand exceeding 12,000 MW, with the peak five-minute interval reaching $17,480/MWh. This is an AEMO-published market price from the competitive bidding process during periods of peak demand tightness (it is not a data error). The overall cap payout for the month came in lower than initial market forecasts, limiting the impact on the monthly average.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202503)
Spot price averaged $79.01/MWh in March, up 5.5% from February’s $74.91/MWh. Queensland reversed February’s dip with a moderate demand-driven recovery, recording elevated spot prices on several days mid-month as cap pricing events increased supply costs.
A moderate rise in demand combined with cap pricing events contributed to more expensive short-term supply across the month. Overall volatility remained lower than NSW, with Queensland’s stronger coal plant availability and solar penetration providing a more stable supply cushion during the period. The QNI interconnector provided some flow management support.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202503)
Spot price averaged $61.79/MWh in March, down 32.3% from February’s $91.34/MWh, the sharpest monthly fall among mainland states. Zero high-price intervals above $1,000/MWh were recorded as high solar penetration and low demand kept supply conditions comfortable throughout the month.
High solar penetration and low autumn demand created frequent negative pricing periods as supply consistently exceeded demand during daylight hours. The 32.3% price fall from February reflects both the seasonal easing of demand and the growing solar generation base contributing to regular oversupply periods. SA demonstrated the characteristic south Australian pattern of zero high-price events alongside frequent sub-zero intervals.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202503)
Spot price averaged $61.75/MWh in March, down 9.9% from February’s $68.55/MWh. Zero high-price intervals above $1,000/MWh were recorded, with stable generation and adequate interconnector flows keeping supply conditions well-managed throughout the month.
Lower demand, strong interconnector flows and stable generation reduced volatility across March. The state recorded 1,786 five-minute intervals at or below zero pricing as renewable output created regular oversupply periods during daylight hours. Victoria’s combination of zero high-price events and frequent sub-zero intervals reflects the shoulder season transition where cooling demand reduces system stress while solar generation remains strong.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202503)
Source: Shell Energy Market Summary Report, March 2025 (AEMO fuel mix data)
Coal held 62% of NEM output over the 90-day period to March (black coal 46%, brown coal 16%). Wind and solar each contributed 16% and 10% respectively, reflecting the late-summer and early-autumn period where solar generation remains strong before declining through winter. Hydro contributed 6% and gas 4%. The 26% combined renewable share is higher than the winter-period equivalent, supporting the favourable spot conditions seen in SA and VIC through March’s shoulder season.
Watt Utilities expanded its service offering in March 2025, now providing commercial and business LPG gas services. Clients can manage both electricity and gas through a single point of contact, consolidating energy procurement and simplifying billing across both utilities.
The addition of LPG services extends the value our team and Watts Mine platform can deliver across a client’s full energy spend. Our Watts Mine platform, which has incorporated AI-driven analysis for over two years, supports contract analysis and market intelligence across electricity, with the LPG offering adding gas procurement support to the same relationship.
AGL commenced construction on a 500 MW grid-scale battery project at the former Liddell coal power station site in NSW. The project will repurpose the decommissioned coal site for energy storage, improving firming capacity in the region with the battery expected to be operational by 2026. The development is one of the larger utility-scale battery projects under construction in Australia.
Source: AGL, March 2025
AEMO released revised demand projections through March 2025, showing slower demand growth across the NEM compared to earlier forecasts. The revision reflects the uptake of energy efficiency measures and commercial solar installations reducing grid consumption. The updated forecasts have implications for future generation investment planning and the pace at which new firming capacity is required.
Source: AEMO, March 2025
The initial phase of Project EnergyConnect was energised in April 2025, linking South Australia, New South Wales and Victoria via a new 900 km transmission line. Stage 1 enables 150 MW of renewable energy transfer between the states, with full capacity of 800 MW anticipated on completion of Stage 2 in 2027. The interconnector is expected to improve grid reliability and support renewable energy integration across the connected states.
Source: ElectraNet / TransGrid, April 2025
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