Extract from ABC News
The fourth quarter of 2025 saw a big jump in the output of wind farms across the country. (ABC News: Nathan Morris)
In short:
Demand for power in Australia's biggest electricity grid reached a record high for the fourth quarter last year.
It came as renewable energy supplied more power than fossil fuels across Australia for the first time in a three-month period.
What's next?
Heatwave conditions are set to push demand for power towards all-time highs in the coming weeks.
Australia's need for electricity is breaking records, with demand in the country's biggest grid reaching an all-time high for the final quarter of the year.
The record came as Australia went past another milestone, with renewable energy supplying more power than fossil fuels in a quarter for the first time.
Batteries, both big and small, are increasingly reshaping Australia's power systems. (ABC News: Glyn Jones)
In its latest snapshot of the national electricity market, which supplies power across the eastern seaboard, the Australian Energy Market Operator (AEMO) said renewed growth in demand for power was continuing with a vengeance.
Average underlying demand, which includes power needs met by millions of rooftop solar panels, hit a new high of 24,271 megawatts in the three months to the end of December.
It was up 530 megawatts — or 2.2 per cent — on the previous high in 2024 and came amid greater demand for heating and cooling, electrification, the rise of power-hungry data centres and population growth.
Despite the record, AEMO noted the seemingly unstoppable growth of rooftop solar was continuing to meet much of the extra consumption.
Rooftop solar alone supplied an average of 4,407 megawatts during the quarter — also a record — while its share at one stage momentarily reached 61 per cent.
Our demand for power hits an all-time high, but rooftop solar supplies most of the extra demand. (ABC News: Glyn Jones)
The contribution of rooftop solar helped renewable energy — along with a burgeoning fleet of large- and small-scale batteries — supply more than half of demand in the NEM in a quarter for the first time.
According to AEMO, renewable energy delivered 51 per cent of overall supply for the period, compared with 46 per cent in the previous corresponding three months.
The agency said the increase "comprised a 29 per cent rise in wind output and a 15 per cent increase in grid-scale solar".
Battery discharge on average "nearly tripled", AEMO said, as huge amounts of new storage were added to the system.
By contrast, AEMO noted coal-fired generation fell to a new average quarterly low of 11,544 megawatts — down 4.6 per cent on a year earlier.
Gas-fired power, too, sank to its lowest level for the three months since 2000, falling 27 per cent compared with the same time in 2024.
Instances where gas power set the price in the evening peak halved for the quarter.
A transition 'turning point'
Violette Mouchaileh, AEMO's executive general manager of policy and corporate affairs, said the December quarter of last year was a turning point in Australia's energy transition.
"This is a landmark moment for the NEM," Ms Mouchaileh said.
"For the first time, renewables and storage supplied more than half of the system's energy needs for a full quarter.
"It reflects years of sustained investment and demonstrates that more wind, solar and battery capacity in the system reduces reliance on higher-cost coal and gas generation, placing sustained downward pressure on wholesale electricity prices."
On the back of the surge in renewable energy output, which typically peaks in the mild, sunny conditions of spring, wholesale prices tumbled.
Across the national market, wholesale power prices averaged $50 a megawatt hour for the quarter, AEMO noted, a 44 per cent reduction compared with 2024.
This was also a 43 per cent — or $37 a megawatt hour — reduction on the three months to September 30.
Falls were largest in Queensland, where they tumbled 55 per cent to $58 a megawatt hour, while prices were lowest in South Australia and Victoria, where they averaged $37 a megawatt hour.
There was also less volatility, with AEMO noting that spot prices above $300 a megawatt hour "added only $3/MWh" to the average for the quarter.
"Increased wind generation and battery discharge, particularly in the evening peaks, reduced reliance on gas and hydro generation in those periods," the agency noted.
"[This contributed] to lower average prices and the reduced incidence of high-priced intervals."
AEMO noted it was not all plain sailing in the national market.
It said interventions were sometimes needed to maintain system strength in Victoria and New South Wales whenever the number of "synchronous generators" — coal and gas plants — dipped below minimum levels.
Australia's main grids still needs big spinning machines like coal turbines for security purposes. (ABC News: Ben Millington)
This is because those plants still help to provide the frequency and voltage services that keep the grid stable and its "heartbeat" at a constant rate.
As well as these interventions, the agency said constraints in the high-voltage power lines linking states meant renewable energy that theoretically could have been traded was instead wasted.
"Economic offloading" of wind and solar capacity — or economic curtailment, as it is known — reached 15 per cent and 18 per cent of availability respectively, it noted.
Grid faces growing extremes
And highlighting the challenges facing AEMO as Australia's energy transition deepens, it noted it was also having to contend with periods of record low demand for power from the grid.
It said "operational demand", which excluded the power needs met by rooftop solar panels, fell to a record low of 9,666 megawatts around midday on Saturday, October 4.
The record was the latest in a series of new lows caused by Australia's abundance of household solar generation, which invariably floods onto the grid and forces out most other sources of generation.
And it contrasts with periods of extremely high demand for power from the grid, such as this week in South Australia, where heatwave conditions drove consumption through the roof.
At one stage on Monday evening, spot prices in South Australia reached the maximum level of $20,300 a megawatt hour as renewable energy fell away and the state had to turn to gas and imports from Victoria to fill the void in record temperatures.
Elsewhere, AEMO said similar trends were observed in Western Australia's biggest market, where a doubling of battery charging helped drive demand higher.
Like the eastern seaboard, the average contribution of renewable energy in meeting demand was greater than half — 52.4 per cent for the quarter.
At one stage, renewable energy was supplying 91 per cent of demand in the west.
"Western Australia is experiencing the same momentum," Ms Mouchaileh said.
At times, rooftop solar can provide almost two-thirds of Australia's power needs. (ABC News: Glyn Jones)
"Greater renewable and storage output continued to place downward pressure on wholesale energy prices in Western Australia, contributing to a 13 per cent fall to $69.55/MWh."
The share of demand in WA's main grid met by coal and gas generation fell 5.8 per cent and 16.4 per cent, respectively.
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