Author - Dave Harvey , Risk Manager at Energy Action

Dave, with over 20 years of expertise in the Australian Energy market, has worked in wholesale trading, in-house energy, and strategic advisory roles. He specializes in portfolio management, employing physical assets and contracts for risk management. His background includes developing procurement strategies such as Progressive Purchasing energy, Power Purchase Agreements, and gas procurement, along with managing LGCs and ACCUs.

Short-term electricity contract prices continued to fall in July, as thermal generation continued to cover renewable shortfalls. Longer-term contract prices rose due to the potential closures of Eraring and Yallourn and increasing uncertainty of replacement generation. Domestic gas prices responded to winter heating demand with limited impact from the Iran conflict. An El Niño event may increase gas demand to meet increased electricity usage this summer due to air conditioning.

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Australian electricity market news, August 2026

Electricity Futures

NSW: CAL 27 averaged $83.38/MWh, down $2.21/MWh on June. CAL 29 averaged $97.98/MWh, up $2.51/MWh, and reached $100.00/MWh intraday. The CAL 27 to CAL 29 spread reached $14.60/MWh, up from $9.88/MWh in June. Eraring closes in April 2029.
VIC: CAL 27 averaged $63.73/MWh, the lowest mainland front year. The CAL 27 to CAL 29 spread reached $20.53/MWh, up from $17.62/MWh in June and the widest in the NEM. Yallourn closes in mid-2028, removing 1,480 MW of brown coal capacity.
QLD: CAL 27 averaged $72.96/MWh and CAL 28 averaged $73.10/MWh, a difference of $0.14/MWh. CAL 29 averaged $78.14/MWh, up $1.46/MWh on June. The Queensland Energy Roadmap sets Callide B's closure at 2031.
SA: South Australia was the only NEM region where all three contract years rose. CAL 27 averaged $83.51/MWh, up $1.25/MWh. CAL 28 averaged $93.32/MWh, up $2.52/MWh. CAL 29 averaged $96.40/MWh, up $4.67/MWh. Project EnergyConnect Stage 2 completed construction and began energising. Inter-network testing starts end-October 2026, ahead of the release of up to 800 MW of transfer capacity.
TAS: CAL 26 averaged $70.26/MWh, down $2.21/MWh on June. CAL 27 averaged $69.54/MWh, down $2.08/MWh. Basslink transferred to regulated transmission on 1 July 2026 and operated its first full month under AEMO dispatch.
WA: CAL 27 averaged $116.96/MWh over the rolling 12-month period, down $0.31/MWh on June. The range ran $109.25/MWh to $122.81/MWh, a spread of $13.56/MWh, matching June.
Gas Market
East coast spot gas rose 35% to 45% in July. Monthly averages reached $11.57/GJ in Queensland, $11.30/GJ in South Australia, $11.22/GJ in New South Wales and $10.27/GJ in Victoria, the highest since February 2026. Southern storage withdrew 7.1 PJ against 2.8 PJ in June. Iona fell from 79.2% to 56.4% of capacity. The ACCC LNG netback price reached $22.41/GJ, double domestic spot. Spot closed to within $1.23/GJ of the 2027 contract floor. Queensland closed $0.07/GJ above it.

Source: Energy Action Analysis

Futures Market
CAL 27 and CAL 28 fell and CAL 29 rose through July. The CAL 27 to CAL 29 spread reached $14.60/MWh, up from $9.88/MWh in June. CAL 29 averaged $97.98/MWh and reached $100.00/MWh intraday. ASX futures price 2027 supply conditions $14.60/MWh below the post-Eraring period.
Eraring ran through July and CAL 27 fell $2.21/MWh across the month. Winter demand and coal availability set a $81.22/MWh floor under the contract. CAL 27 averaged $83.38/MWh, CAL 28 $87.39/MWh and CAL 29 $97.98/MWh.
CAL 27: Averaged $83.38/MWh, down $2.21/MWh from June's $85.59/MWh, and traded an $81.22/MWh to $86.35/MWh range. Eraring's availability removes coal-exit scarcity from 2027 pricing. Winter demand and evening firming requirements set the $81.22/MWh floor.
CAL 28: Averaged $87.39/MWh, down $0.77/MWh from June's $88.16/MWh, and traded an $85.65/MWh to $89.50/MWh range. CAL 28 closed $4.01/MWh above CAL 27, pricing one further year of proximity to Eraring's April 2029 closure. Battery discharge covers part of the evening peak across 2028.
CAL 29: Averaged $97.98/MWh, up $2.51/MWh from June's $95.47/MWh, and reached $100.00/MWh intraday. CAL 29 recorded the largest move on the New South Wales curve in July. Coal reliability, replacement capacity delivery and transmission timing set 2029 pricing.

Supply Outlook
Eraring's April 2029 closure date held through July. Eraring's availability covers New South Wales demand to that date, and ASX futures price CAL 27 at $83.38/MWh against CAL 29 at $97.98/MWh. New South Wales requires replacement generation, firming capacity and flexible supply commissioned before April 2029.

Renewable energy impact and evening peak reliance across the states.

Spot prices fell in four of five regions
Spot prices fell in New South Wales, Queensland, South Australia and Tasmania in July. Victoria was the only region to rise. Monthly averages reached $81.52/MWh in New South Wales, $65.43/MWh in Queensland, $95.89/MWh in South Australia, $71.04/MWh in Tasmania and $70.36/MWh in Victoria.
South Australia averaged $95.89/MWh, the highest of the five regions and $29.86/MWh below June, and recorded prices above $300/MWh in 4.38% of intervals, the only region above 1%. Queensland averaged $65.43/MWh, the lowest of the five regions and down $5.99/MWh. Negative intervals reached 7.46%. Tasmania averaged $71.04/MWh and its negative intervals reached 7.84%, up from 0.44% in June. Net interconnector flows matched the price ranking. Queensland exported 507 GWh and Victoria exported 223 GWh. New South Wales imported 709 GWh and South Australia imported 172 GWh.
Two southern scarcity events carried June's South Australian volatility into July. Negative intervals rose in New South Wales, Queensland and Tasmania and fell in South Australia and Victoria. Renewable oversupply and firming volatility now occur in the same region within the same month.
Southern wind decline set the month's price peaks on 8 July
Wind output across South Australia, Victoria and Tasmania fell through the evening of 8 July. Five-minute prices reached $16,971/MWh in South Australia, $19,070/MWh in Victoria and $17,050/MWh in Tasmania, and prices above $300/MWh exceeded 20% of that day's dispatch in all three regions. The South Australia import path bound at its limit, and gas-fired generation and battery discharge covered the shortfall. A second event on 30 and 31 July drove South Australian daily averages to $388/MWh and $302/MWh, and AEMO issued low-reserve forecasts for the South Australian evening peak. Four Queensland coal units ran offline through late July and baseload availability tightened. The Waratah Super Battery in New South Wales offered 700 MW against its 850 MW rating, pending a replacement transformer scheduled for third-quarter 2026 delivery. Southern wind decline tightened reserve margins faster than any other driver in July, across a larger battery fleet than the market held a year earlier.

Market Pricing and Outlook

Storage
Southern gas storage withdrew 7.1 PJ through July against 2.8 PJ in June. One petajoule (PJ) equals one thousand terajoules (TJ), and one terajoule equals one thousand gigajoules (GJ). Iona underground storage in Victoria fell from 79.2% of capacity on 1 July to 56.4% on 30 July, a withdrawal of 6,335 TJ. Daily withdrawal averaged 218 TJ against 92 TJ in June. Newcastle fell from 72.2% to 40.3%, a withdrawal of 565 TJ, matching its role as a fast-response facility drawn for short-duration peak demand. Dandenong fell from 91.0% to 89.6%.
The steepest withdrawals cluster around the southern scarcity event of 8 July. Iona withdrew 384 TJ on 8 July and 430 TJ on 9 July. The 8 to 13 July period withdrew 1,312 TJ across five days. Northern storage withdrew 446 TJ across the month: 181 TJ at Silver Springs, 135 TJ at Moomba and 130 TJ at Roma.
Southern storage covered 44% of the 16 PJ southern supply gap the ACCC projected for July. Northern pipeline flows covered the balance. Iona closed 30 July at 15,732 TJ, 72 days of cover at July's 218 TJ/day rate.
Policy and reform
Consultation on the Domestic Gas Reservation Scheme draft design framework closed on 30 June and submissions were published through July. The scheme requires LNG exporters to supply the domestic market with gas equivalent to 20% of their annual export volumes. Obligations commence 1 July 2027, pro-rated for the second half of that year. Export contracts entered on or before 22 December 2025 carry an exemption. Legislation is targeted for 2027.
The scheme replaces the Australian Domestic Gas Security Mechanism, the Heads of Agreement and the conduct provisions of the Gas Market Code.
Western Australia
Scarborough reached 96% completion in July and Woodside confirmed first LNG cargo for the fourth quarter of 2026. The project adds up to 225 TJ/day of domestic gas capacity at Pluto against Western Australian consumption of around 1,085 TJ/day. AEMO forecasts Western Australian supply and consumption in balance through 2026 and 2027, a supply gap of around 11 TJ/day from 2030 and 82 TJ/day by 2035. Western Australian contract prices sit $2.15/GJ to $4.65/GJ below east coast levels under the state's 15% domestic reservation policy.

Small Scale Technology Certificates (STCs)​

Spot Prices

East coast spot gas rose 35% to 45% in July and closed to within $1.23/GJ of the 2027 contract band. Monthly averages reached $11.57/GJ in Queensland, $11.30/GJ in South Australia, $11.22/GJ in New South Wales and $10.27/GJ in Victoria. Increases on June ran $2.95/GJ to $3.21/GJ. All four regions recorded their highest monthly average since February 2026.

Peak winter demand met southern supply tightness through the month. The ACCC projected a 16 PJ southern supply gap for July, and Iona storage withdrawals and northern flows down the South West Queensland Pipeline covered it. Gas-fired generation added load through the southern scarcity event of 8 July. The Victoria to Queensland spread reached $1.30/GJ against $1.37/GJ in June, matching a system-wide move.

Queensland closed $0.07/GJ above the $11.50/GJ CAL 27 contract floor and Victoria closed $1.23/GJ below it. The June gap ran $4.55/GJ to $5.92/GJ measured against the $13.00/GJ floor quoted in the July edition.

Large Generation Certificates (LGCs) ​

Retail Contract Prices

LGC spot opened July at $7.25, reversed June's rally and fell to a monthly low of $4.60 on 13 July. Prices recovered across the second half of the month to close at $6.45. Spot volume fell 65% to 1,543,000 certificates from 4,427,000 in June. The late-month recovery coincided with renewed policy discussion on renewable-energy obligations for data centres. Turnover held below June across every trading day, and the certificate surplus persists.

Victorian Energy Efficiency Certificates (VEECs) 

July trading reversed June's decline, with spot recovering through the first half of the month and easing into month end.
Spot Market

VEEC spot rose from $82.00 to a peak of $87.00 on 13 July and closed at $83.00, $1.50 above June's $81.50 close. Spot volume fell to around 355,000 certificates from 519,000 in June. The largest daily volume reached 55,000 certificates on 13 July.
Forward Contracts

Aug-26 to Apr-28 forwards traded in parcels of 5,000 to 35,000 certificates on volume of around 155,000 certificates, 44% of spot volume. Prices ran $81.75 to $85.50 and tracked the spot path. An Apr-28 parcel of 35,000 certificates traded at $85.50 on 14 July and a Jan-27 parcel traded at $84.15 on 24 July, both above spot.
Key Insight

VEEC spot closed at $83.00, $1.50 above June, reversing June's decline. Forwards closed above spot, and Apr-28 interest returned at $85.50.

ESC spot prices eased through July, opening at $29.50 and closing at $29.25, $0.50 below June's close. Front-vintage forwards traded below spot, pointing to near-term softening extending into the forward curve.
Spot Market

ESC spot opened at $29.50, fell to a low of $28.60 on 22 July and closed at $29.25 on 30 July. Prices traded a $28.60 to $29.75 band across the month, a range of $1.15, and closed within $0.25 of the open. Volume fell to around 870,000 certificates from 1,020,000 in June.
Forward Contracts

Jul-26 to Dec-26 forwards traded around 130,000 certificates, 15% of spot volume. Aug-26 and Sep-26 parcels traded at $28.50 on 7 July, $0.75 below the spot close. Oct-26 and Dec-26 parcels traded at $29.75 and $29.50 on 8 July, within $0.50 of spot.
Key Insight

ESC spot closed $0.50 below June, continuing the fall that began at June's month end. Aug-26 and Sep-26 forwards traded at $28.50, $0.75 below the spot close, carrying that fall into the forward curve.

July pricing points to a firming, forward-supported ACCU market. Forward trading extended to the May-27 vintage, building on the positioning that reappeared in June.
Price Movements by ACCU Type:
Standard ACCUs (No AD (Avoided Deforestation)): Traded a $37.80 to $38.35 range, opened at $37.90 and closed at $38.30, up $0.45 on June. Spot volume reached around 995,000 units, matching June.
HIR ACCUs: Traded a $37.95 to $38.35 range, opened at $38.00 and closed at $38.35, up $0.45 on June. Spot volume reached around 135,000 units.
Key Insight

Forwards traded across the Nov-26, Dec-26, Feb-27, Mar-27, Apr-27 and May-27 vintages at $38.35 to $39.25, above the $38.30 spot close at every tenor. The highest forward trade reached $39.25 on 30 July in the Apr-27 and May-27 parcels, $1.15 below June's $40.40 high.

Latest data available from Utilibox as of 29th January