10 Oct 2019
Issue 37: Institutional Challenges Facing the NEM
The NEM is facing unprecedented challenges dealing with the influx of new technologies and there are few international precedents to draw on. So we face an existential question; are our governing institutions up to the task?
Issue 37: Institutional Challenges Facing the NEM
The NEM is facing unprecedented challenges dealing with the influx of new technologies and there are few international precedents to draw on. So we face an existential question; are our governing institutions up to the task?
In this article IES’s CEO, Hugh Bannister, takes a look at the challenges facing the institutions that are involved in managing or oversighting the NEM. He argues that it’s time for the industry to open up and be more proactive in prototyping and trialling new market concepts, including at the distribution end. ARENA’s remit is currently too limited. The aim is for the industry to become more agile in practice as well as in word. Failing that, the future NEM looks likely to be centrally controlled, highly regulated, inflexible and expensive.
17 Jun 2019
Insider 36: The Strange Case of Snowy 2.0
In this article IES’s CEO, Hugh Bannister, uses NEO's premium curve chart to review and provide some insights into the evolution of NEM prices over the years. He then analyse Snowy 2.0’s place in the system.
Insider 36: The Strange Case of Snowy 2.0
IES’s NEO data visualisation tool has a special and extremely useful form of processing in its toolbox that generates what we call a premium curve. Such curves can be displayed on a chart of NEM regional spot prices over some period such as a year, along with the fixed and variable costs of a range of supply technologies. In this article IES’s CEO, Hugh Bannister, uses this chart to review and provide some insights into the evolution of NEM prices over the years.
Then, as an exercise, he attempts to use this tool to analyse Snowy 2.0’s place in the system. However, Snowy 2.0 appears as an outlier when analysed from several angles. It’s also very hard to reconcile its commercial operation with Angus Taylor’s target wholesale price target of $70/MWh unless that number is rather short term. Under a premium curve analysis, Snowy 2.0 is a strange case indeed.