Blackout threat looms as NSW, Victoria, Queensland, South Australia brace for power outages

Millions of Aussies are being warned to brace for mass blackouts on Tuesday night as freezing temperatures and a national shortage of power create a perfect storm of issues. 

The Australian Energy Market Operator (AEMO) was forced to intervene on Monday by ordering extra generators to come online to cover power shortages and warned of more of the same on Tuesday. 

The recent polar surge, which has brought freezing temperatures to much of the country, has drained the power grid more than normal as Aussies blast their heaters and air-conditioning to stay warm.

The increased pressure on the power grid has been compounded by unreliable coal power plants and generators powered down after AEMO ordered a price cap on soaring energy prices.

Queensland and NSW residents are being asked to cut down on their power use again on Tuesday night with electricity supplies forecast to fall short for a second winter’s night.

Victoria and South Australia are facing similar threats to their power grids.

The AEMO on Tuesday issued a ‘lack of reserve’ warning for Wednesday evening, meaning the forecast demand was likely to outstrip supply in Victoria.

It said outages could be expected between 6pm and 7.30pm.

Millions of residents in NSW and Queensland have been warned of possible power outrages on Tuesday night

Households and businesses in the southeast and coastal areas of Queensland are facing blackouts from 5pm to 9pm on Tuesday.

And in NSW, a shortfall is expected on Tuesday night between 5.30pm and 9pm.

NSW Treasurer and Energy Minister Matt Kean said he was closely monitoring the power crisis.

‘There’s huge challenges in the energy sector at the moment,’ he said on Tuesday.

The wholesale price of energy supply is spiking as the war in Ukraine drives up gas and coal prices.

‘Because prices have been consistently high over the last week, the price cap has come in to protect NSW customers,’ he said.

For the second day in a row, generators have been asked to supply more electricity. 

‘AEMO has not yet estimated the latest time at which they would need to intervene,’ it said in a statement on Tuesday.

Transmission company Powerlink’s Chief Executive Paul Simshauser said people should ‘be a bit thoughtful’ and reduce their energy use on Tuesday night.

‘If you’ve got your air conditioner on … just make sure it’s not set to blast furnace mode,’ he told ABC Radio.

The blackouts were expected to plunge east coast residents into darkness during the ‘evening peak’ from 5:30pm to 8pm on Monday, and then again on Tuesday morning (stock image)

There has been a supply crunch since Sunday when electricity generators stopped offering to supply power after AEMO capped skyrocketing wholesale electricity prices.

‘Households can manage their electricity usage by considering the number of rooms being heated by air-conditioners. Turning off computers, TVs and other household appliances in standby mode. Or even turning off your pool pumps and second fridges,’ Powerlink Queensland said.

AEMO claimed supplies are low even though there is ‘sufficient physical generation capacity’ in the state.

The order to power up generators with the price cap in place means many power providers are running at a loss. 

Queensland Energy Minister Mick de Brenni said he did not need to intervene because AEMO is taking care of the situation.

‘This is a system design that is doing its job at the moment, which means power stays on, we’ve got adequate supply,’ he told ABC Radio on Tuesday.

The minister blamed the electricity crisis on higher demand amid cold weather, high gas prices due to the Ukraine war and maintenance outages at public-owned coal power plants.

Some of those plants will be back generating electricity by Thursday, the minister said, but some will be out of action until next April.

Wholesale electricity prices are set by the highest bidder in Queensland, and 83 per cent of power comes from coal and gas plants.

State-owned generators Stanwell Corporation and CS Energy are shielded from high coal prices as they own their own coal mines.

The government can order its two generators to offer cheaper electricity to the market to keep prices lower.

Mr de Brenni has resisted calls to do so, and recently denied that the two public generators have been price gouging.

The market operator has capped wholesale prices anyway, he said, so his intervention isn’t needed.

The shortage of electricity comes amid soaring demand for gas and electricity and additional coal-fired power outages in Queensland. Pictured is a coal-fired station

Queensland household electricity bills are set to rise by at least $43 per month from July, but analysts predict they will rise again before mid-2023 if wholesale prices continue surging to record levels.

Instead of dousing wholesale prices, the state government will wipe $43 from monthly power bills until mid-2023.

Mr de Brenni said investing more in solar and wind farms, and electricity storage, would shield Queenslanders from future blackouts in the longer term.

Soaring prices of energy on Sunday triggered the energy price cap after seven consecutive days of surging wholesale prices.

The cap limited the wholesale price to $300 a megawatt hour, with generators along the east coast asked by AEMO to continue running despite being unable to make a profit at these levels. 

The ‘high price threshold’ threshold of $1.359million over a week, or an average of $674.16/MWh, was reached just before 7pm on Sunday night. 

‘As a consequence, available offers from generators reduced, contributing to a forecast supply shortfall,’ the AEMO said in a statement. 

Victoria is also