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).
September 2025 saw spot prices ease across the mainland NEM as mild spring weather and strong renewable generation created favourable supply conditions. Despite several major planned and unplanned thermal outages, prices fell across all states from August levels, with Queensland recording the lowest mainland average at $54.35/MWh. The month highlighted the market’s sensitivity to seasonal transitions, with minimal interconnector constraints allowing unrestricted electricity flow between states. Forward contract markets held elevated levels as participants priced in decreasing thermal reliability and summer demand risk, even as spot markets delivered relative stability during the shoulder season.
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 | $54.35 | $528.73 | 0 | 2,961 |
| NSW | $71.24 | $599.99 | 0 | 2,347 |
| VIC | $55.27 | $623.92 | 0 | 2,982 |
| SA | $57.60 | $1,001.00 | 1 | 3,332 |
Source: NEM Spot Market, AEMO (via Shell Energy Market Summary Report, September 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 contracts saw upward pressure through September despite spot prices falling across all states. The disconnect between falling spot rates and resilient forward prices reflects traders’ focus on summer demand risk and declining thermal reliability rather than current conditions. Victoria’s CY2026 contracts carried the most notable premium, supported by Loy Yang A closure uncertainty. For businesses with renewals in the first half of 2026, the current forward market references summer risk. Those who can defer decisions until after the summer period may find a clearer picture as seasonal demand resolves. Near-term renewals face the reality that forward prices reflect risk premiums that won’t disappear until market participants see how summer actually unfolds. Partial contracting strategies, locking in a portion now with flexibility on the balance, remain a practical approach in this environment.
Average pricing fell to $71.24/MWh in September, a 29.6% decrease from August’s $101.25/MWh. Zero high-price intervals above $1,000/MWh were recorded for the month, a marked contrast to August’s volatility events.
NSW benefited from improved renewable generation and mild spring temperatures creating stable pricing conditions. The state recorded 2,347 intervals of zero or negative pricing as solar and wind output normalised after the winter period. Multiple thermal outages occurred but had minimal pricing impact given mild demand conditions.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202509)
Spot pricing averaged $54.35/MWh in September, a 30.5% decrease from August’s $78.20/MWh. Queensland recorded the lowest mainland average for the month and zero high-price events above $1,000/MWh.
Strong solar penetration and improved wind conditions combined with mild temperatures to deliver the most favourable pricing environment across the mainland NEM. The state recorded 2,961 intervals at or below zero pricing. Multiple planned and unplanned coal outages occurred but failed to trigger price spikes given the strong renewable output.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202509)
Average pricing reached $57.60/MWh in September, a 33.7% decrease from August’s $86.86/MWh. The state recorded 3,332 intervals at or below zero pricing, the highest count across all mainland states, reflecting extensive renewable oversupply during daylight hours.
SA recorded one high-price interval reaching $1,001.00/MWh during a brief wind lull. The month demonstrated SA’s characteristic extremes: extended periods of renewable oversupply pushing prices to zero and below, alongside isolated brief shortfalls when wind dropped. Overall the state delivered a 33.7% improvement on August as spring conditions boosted renewable output across the generation mix.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202509)
Spot pricing averaged $55.27/MWh in September, a 40.7% decrease from August’s $93.19/MWh. Zero high-price intervals above $1,000/MWh were recorded, with the state recording 2,982 zero or negative pricing intervals across the month.
Wind generation recovered strongly after winter and coal plant availability improved, contributing to stable shoulder season pricing. The 40.7% fall from August reflects the combined effect of lower demand as temperatures moderated and improved supply adequacy as the generation fleet returned to higher availability through spring.
Source: AEMO (via WEB_AVERAGE_PRICE_DAY_202509)
Source: Shell Energy Market Summary Report, September 2025 (AEMO fuel mix data)
The 90-day period from July to September 2025 shows coal holding 58% of NEM output (black coal 43%, brown coal 15%), reflecting continued winter baseload reliance. Wind contributed 21%, solar 8% and hydro 7%, with gas providing 5% of peaking support. The 29% combined renewable share sits below the shoulder season levels seen in October onward as improved spring conditions were only beginning to lift solar and wind output through the tail end of the period.
Throughout September, Watt Utilities continued expanding our energy management services for commercial and industrial clients across Queensland, New South Wales and Victoria. Our team successfully negotiated competitive contracts for multiple C&I and SME clients ahead of the summer period, using market intelligence drawn from our Watts Mine platform to secure favourable pricing before expected seasonal demand pressures emerge.
Our Watts Mine platform, which has incorporated AI-driven analysis for over two years, supported this work with detailed forward market modelling and contract scenario analysis, helping clients evaluate their position against the prevailing forward curve and understand the trade-offs between locking in now versus carrying summer exposure.
AEMO progressed its renewable integration work in September 2025, releasing consultation materials and updated technical guidance to support grid stability as renewable penetration increases. Key updates included draft requirements for grid-forming inverter technologies and reforms to improve forecasting and system strength. The initiatives reflect lessons from recent operational challenges and aim to improve the integration of large-scale wind and solar into the NEM.
Source: AEMO, September 2025
The Federal Government launched Tenders 5 and 6 under the Capacity Investment Scheme in October 2025, targeting the Western Australian market. The combined tenders aim to secure 1.6 gigawatts of new renewable generation and 2.4 gigawatt-hours of dispatchable capacity. The round is expected to unlock up to $4 billion in private investment, supporting WA’s transition from coal-fired power as part of Australia’s broader clean energy programme.
Source: Department of Climate Change, Energy, the Environment and Water, October 2025
Our team works with SME, C&I and Strata clients across Queensland, New South Wales and Victoria. Get in touch for a no-obligation portfolio review.
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