Senior policy analyst for energy at the Centre for Independent Studies, Jude Blik, has said a landmark report produced by his think tank proves \u201cAustralia has the most volatile power market in the world\u201d due to Labor\u2019s renewable energy push.<\/p>\n
The report, titled: “Risky Business”, claims the renewable energy transition will lead to higher prices for consumers, more frequent retailer failures and less competition in Australia.<\/p>\n
The paper revealed wholesale price volatility was rising sharply in the Australian energy market, with extreme price spikes becoming more frequent at all times of the day due to the intermittent nature of renewable energy.<\/p>\n
Wholesale energy prices in Australia have seen significant increases of over $90 per megawatt-hour ($34 in Queensland to $96 in Victoria) quarter-on-quarter as of July 2025 and, compared to the same period last year, prices are up 10 to 25 per cent in most regions.<\/p>\n
The report also states the surge in rooftop solar usage has created a hidden cross-subsidy, where non-solar households are effectively paying more for their electricity as retailers are forced to pass through losses from solar customers.<\/p>\n
Mr Blik said the comprehensive study of Australia\u2019s energy market \u201cproved that Australia has the most volatile power market in the world\u201d.<\/p>\n
\u201cWe think about it like Weet-Bix, it\u2019s always there, it\u2019s always the same price, it\u2019s going up, but at least it\u2019s kind of sturdy and we know what we\u2019re going to get in the bill if we know our usage, but behind the scenes Australia\u2019s wholesale electricity market is incredibly volatile,\u201d he said.<\/p>\n
The energy analyst noted the nation only experienced 18 extreme price events, which are periods of sudden, high and often temporary spikes, in 2012 yet by 2024 there were over 600.<\/p>\n
\u201cThat\u2019s a factor of 200 and risk equals cost, the derivatives that retailers need to use to manage all of that volatility have only gone up in price and that is driving Australia\u2019s high electricity costs,\u201d he said.<\/p>\n
Mr Blik pointed out the shocking statistic undermined the certainty people making long term decisions for the power market needed and would further harm investment certainty for wind and solar projects.<\/p>\n
\u201cWe see they are now needing to be subsidised by the government as well \u2013 we\u2019ve got the Capacity Investment Scheme which is a completely un-costed and hidden cost to the taxpayer,\u201d he said.<\/p>\n
\u201cWe have a recent Nelson review of the National Electricity Market, which is out by AEMO, which had recommended an electricity services mechanism which is just another name for a warehousing of risk, which is effectively a subsidy so they can artificially de-risk these projects for the investors.\u201d<\/p>\n
He also said households without solar panels were effectively subsidising those with them due to the fact rooftop solar fluctuates significantly and accordingly does not materially reduce grid costs.<\/p>\n
“In the middle of the day, the wholesale power price often goes negative, its becoming more and more regular as all of the power supply from solar panels dumps into the grid and so that means your power actually has a negative value to your retailer,\u201d he explained.<\/p>\n
\u201cIt actually costs them to get rid of your power onto the grid because it has a negative price. Instead of charging solar users more, what they\u2019ll do is they will charge everyone more, raise that price level so that solar users don\u2019t have to take the hit, which means non solar users are subsidising the solar panel users.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Senior policy analyst for energy at the Centre for Independent Studies, Jude Blik, has said a landmark report…\n","protected":false},"author":2,"featured_media":236361,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164,2572,19182],"class_list":["post-236360","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy","tag-energy","tag-net-zero"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/236360","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=236360"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/236360\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/236361"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=236360"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=236360"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=236360"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}