08/04/2026
Thinking about using Amber as your retailer, well you will want to know about the likelihood of price spike events which can cover those admin fees and supply charges.
Over the last two years, the National Electricity Market (NEM) has shifted from a period of extreme crisis in 2022 to a "volatile transition" phase. While average wholesale prices have generally trended downward, the frequency of extreme spikes (prices exceeding $5.00/kWh) has become more concentrated and tied to specific regional stress events.
1. Historical Look: Volume & Reasons (FY24 - FY26)
- NSW had high spikes in FY24 and moderate in FY25/26. These price spikes were caused by coal unreliability & demand: Retirement of Liddell and outages at remaining coal plants (Eraring/Bayswater) combined with extreme humidity-driven demand.
- QLD had high spikes in FY24 and low/moderate in FY25/26. Humidity & Storms: Summer 23-24 saw record peak demand. 2025 has been calmer, though gas costs remain a floor for spike prices.
- SA had moderate spikes in FY24 and high in FY25/26. Wind Droughts: Spikes occur when "wind lulls" coincide with the evening peak, forcing high-cost gas to set the price.
- VIC had low spikes for both years. Transmission Faults: Most spikes were caused by storm damage to transmission lines (Feb 2024) rather than a lack of generation.
- TAS had minimal spikes both years. Drought: Low hydro levels caused high average prices in early 2024, but rarely result in $5kWh spikes.
Key Trend: In the last 12 months, the NEM saw a record number of negative prices (over 6,000 intervals). We are seeing a "Barbell Effect": prices are at the floor (-$1.00/kWh) during the day and spike ($15.00/kWh) during the evening "ramp."
2. Forecast for FY27 (July 2026 – June 2027)
The forecast for FY27 suggests a "tightening" of the market as we approach major coal exits.
Timing of Spikes
Summer Peak (Dec 2026 – Feb 2027): This remains the highest risk period. Expect spikes between 5:30 PM and 8:30 PM. As rooftop solar continues to grow, it "hollows out" daytime prices but makes the evening ramp steeper and harder for the grid to manage.
Winter Peak (June – July 2026): High risk for the southern states (VIC/SA). Spikes are likely during mornings (7:00 AM - 9:00 AM) on cold, still days when wind generation is low and heating demand is high.
Frequency Forecast
NSW (Highest Frequency): Expect an increase in spike frequency in early 2027. Although the Eraring closure was extended to August 2027, the plant’s reliability usually dips in its final months, and NSW is increasingly reliant on imports from QLD and VIC.
SA (Most Volatile): SA will likely see the most frequent "mini-spikes" ($1.00 - $3.00/kWh). These occur almost weekly during the shoulder seasons (Spring/Autumn) when wind output is unpredictable.
VIC & QLD (Stable but Extreme): Lower frequency, but when they do spike, they are likely to hit the Market Price Cap (which increases to $20.70/kWh on July 1, 2026).
3. Why the Spikes Are Changing
The "Price Cap" Escalation: The AEMC is aggressively raising the price cap to encourage new investment. By FY27, a single spike will be 25% more expensive than it was two years ago.
Battery Mitigation: The massive rollout of big batteries (Waratah Super Battery, etc.) will likely reduce the total number of spikes, as they can "shave" the top off the price. However, they cannot yet prevent spikes caused by major transmission failures.
Gas Dependence: Until more storage is online, gas remains the "price setter" for spikes. With international gas prices remaining high, the "floor" for these spikes is unlikely to drop.
Strategic Recommendation
If you are running home automation or a VPP-linked battery, FY27 will be a year of high-value, low-frequency events.
This means you need:
- a good export limit set by your DNSP,
- good inverter size: this limits how much you can export per hour,
- battery capacity to export during these events in the evenings or early morning and
- great self driven automation, VPP or swift manual intervention,
to capitalise on wholesale spikes.
If you are in Tassie, I wouldn’t be suggesting Amber but for NSW and SA there could be a real benefit.