June 15 -- Five states on the Eastern coast of Australia could plunge into darkness starting this afternoon, the Australian Energy Market Operator (AEMO) has warned amidst power shortages in the country, News.com.au reported.
Post pandemic, energy prices have seen a sharp uptick. Last September, we reported how higher energy prices were threatening a collapse in the European cold and are now pinching consumers' pockets in Australia. The southern continent is now facing an unusually cold winter that has pushed up customer energy demands, which is driving prices even higher.
Capping prices take generators offline
Australian power utilities rely on coal and gas for their power generation. Recent floods in the eastern states have flooded coal mines and restricted transport routes, increasing the costs for power generation companies.
In a bid to control the cost of wholesale electricity prices in Queensland, New South Wales, Victoria, and South Australia, the AEMO ordered a price cap on Sunday, 7News reported. However, the power companies responded by taking their plants offline, sending some areas into blackouts.
On Tuesday, when residents of Queensland return home, a serious power supply issue is expected between 5 - 9 pm, while people in New South Wales need to brace for disruptions between 5:30 - 8:30 pm, News.com.au reported. The states of Tasmania, South Australia, and Victoria are expected to be impacted by Wednesday night.
The AEMO ordered some plants online on Monday, but with temperatures plummeting further in the coming weeks, the situation is expected to worsen.
Aging coal-fired plants, low renewable power
The situation has also been compounded by outages of coal-fired plants in the eastern parts of the country. The unplanned maintenance works that had to be taken up have disrupted the power supply in the region.
Last week, AGL, the country's largest power generation company confirmed that one of its coal-fired units in Victoria, which had gone offline in April following an electrical fault, was expected to be back only in September, ABC News reported. Along with the unit, a quarter of Australia's coal-fired power generation capacity was offline, even before AEMO initiated the price caps.
Experts told 7News that the crisis had been in the making for many years now after the government's reliance on aging coal-fired plants and reluctance to quickly add renewable energy capacities. According to energy.gov.au, fossil fuels contributed 71 percent of power generation in 2021, with coal accounting for 51 percent of total production.
With many coal-powered plants set to retire by the end of the decade, Australia needs to ramp up its renewable energy installations to achieve its net-zero target by 2050. The country has also pushed for distributed energy resources, where power is generated behind the meters using rooftop photovoltaic cells and thermal energy storage.
The state of Victoria unveiled Tesla's Megapacks in December of last year to store renewable energy and prevent blackout-like events when the power supply was stressed. But the battery packs can only tide over about an hour of energy requirements. Come Wednesday, the state's residents will face a power disruption much worse than they had imagined.
Winters in Australia extend into July, and with a new power generation plant unlikely to come up during this time, residents in eastern Australia are set for a bumpy ride ahead.