5 February 2026
Just as during question time in the comfortably airconditioned Parliament the price of electricity was discussed in its umptieth iteration ……………
Mr CHESTER (Gippsland) (14:42): My question is to the Minister for Climate Change and Energy. The minister has had several opportunities in question time this week to explain when Australian families can expect the $275 reduction in their power bills promised by the Prime Minister. Will the minister finally admit the Prime Minister wasn’t telling the truth and not a single Australian family has seen the $275 reduction? Minister, why can’t anyone in the Labor Party accept responsibility and just say ‘sorry’ to the Australian people, who are struggling under Labor’s cost-of-living crisis?
Mr BOWEN (McMahon—Minister for Climate Change and Energy) (14:42): I thank the honourable gentleman for his question. I take responsibility for the energy system in Australia. I take responsibility, as the minister, for progress. I take responsibility for dealing with the headwinds and the setbacks. That’s what a minister does. A minister takes responsibility and deals with it—doesn’t hide. Electricity rises before an election, for example. That’s an option. That is an option available to a minister. That’s not an option that I’ve chosen to take. I take responsibility for the progress. I take responsibility for dealing with the setbacks. I take responsibility for the more than a thousand batteries that have been installed in the honourable member’s electorate, the 1,139, that have been installed in the member’s electorate since 1 July. I note that, in Victoria, the wholesale price of energy in May 2022 was $233 a megawatt hour, and today it is $37 a megawatt hour. I do take responsibility for all the above.
https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=CHAMBER;id=chamber%2Fhansardr%2F29135%2F0123;query=Id%3A%22chamber%2Fhansardr%2F29135%2F0000%22
………. there was a price spike in NSW of $9,200/MWh after prices had already hit $20,000/MWh just 20 min earlier:
Fig 1: Price spikes in NSW on 5 Feb 2026. Max demand was around 12,100 MW at 4:20 pm
$9,200 / MWh is $9.20/kWh (wholesale). The average over 24 hrs was $ 406/MWh. The average lower than the price cap of $600/MWh was $150/MWh. The price cap was exceeded for 1.6 hrs. What does that mean for retail prices? Let’s make the following back-of-the-envelope calculation:
Assume a customer is paying 25 cents/kWh retail and the wholesale component is 40% that would be 10 cents. The other components would be 15 cents. The $150/MWh below the price cap would be 15 cents/kWh. So the retail price would be 15 cents + 15 cents= 30 cents
If there is 1 hot day per week with 40 cents/kWh wholesale then retail would increase further by (40-15)/7 = 3.6 cents. Total 33.6 cents/kWh.
Fig 2: Temperatures on 5 Feb 2026 presented in the 7 pm news
Fig 3: NSW generation by fuel type on 5 Feb 2026
A windless, cloudy, hot afternoon required early ramp of hydro, gas and coal long before sunset.
Fig 4: The afternoon was cloudy with an early drop in solar power
Fig 5: Clouds moved over Nevertire solar farm starting at 1 pm
Note also in Fig 3 the sudden need to export power to Victoria starting at 2 pm because there was a drop in solar power there.
Fig 6: drop of solar utility in Victoria
There was also a problem with the Avon – Marulan 330 kV transmission line
https://wattclarity.com.au/articles/2026/02/05feb-nsw-volatility-continues/
https://wattclarity.com.au/articles/2026/01/12jan-avon-to-marulan-outage/
Fig 6: Transgrid’s Avon – Marulan 330 kV transmission line
https://www.transgrid.com.au/media/efvbydhp/transgrid-pscr_managing-risk-on-line-16_16-june-2023.pdf
Out of the 12 coal power units, 3 were offline.
Fig 7: Utilization of available coal plants was 97%
Fig 8: Vales Point was completely offline since 2 Feb
133232 POWER SYSTEM EVENTS 02/02/2026 03:06:06 PM
Non-credible contingency event – NSW region – 02/02/2026
AEMO ELECTRICITY MARKET NOTICE.
Non-credible contingency event – NSW region – 02/02/2026
At 1342 hrs Vales Point Power Station Unit 5 and Unit 6 tripped.
AEMO did not instruct load shedding.
AEMO has not been advised of any disconnection of bulk electrical load.
The cause of this non credible contingency event is not known at this stage.
Manager NEM Real Time Operations
7/10/2022
Sale of Vales Point: How will Czech brown coal baron Pavel Tykac with
business registered in Liechtenstein impact on NSW coal and energy markets?
https://crudeoilpeak.info/sale-of-vales-point-how-will-czech-brown-coal-baron-pavel-tykac-with-business-registered-in-liechtenstein-impact-on-nsw-coal-and-energy-markets
Lack of Reserves
133306 RESERVE NOTICE 05/02/2026 04:07:37 PM
Actual Lack Of Reserve Level 1 (LOR1) in the NSW region – 05/02/2026
AEMO ELECTRICITY MARKET NOTICE
Actual Lack Of Reserve Level 1 (LOR1) in the NSW region – 05/02/2026
An Actual LOR1 condition has been declared under clause 4.8.4(b) of the National Electricity Rules for the NSW region from 1600 hrs.
The Actual LOR1 condition is forecast to exist until 05/02/2026 1730 hrs
The capacity reserve requirement is 1370 MW
The minimum capacity reserve available is 1225 MW
Manager NEM Real Time Operations
https://www.aemo.com.au/market-notices
This reserve notice was cancelled at 5:48 pm (notice 133311)
The mainstream media did not report about the price spikes so the public is unaware what happened and what the causes are. The opposition sometimes mentions possible power shortages but this is seen as a political stunt. So there will be a surprise when it really happens as a result of various factors coinciding.
Related post:
10 Jan 2026
Sydney temperatures of 43 degrees push demand to 13,000 MW costing $12,000/MWh
https://crudeoilpeak.info/sydney-temperatures-of-43-degrees-push-demand-to-13000-mw-costing-12000-per-mwh
Updates
133344 POWER SYSTEM EVENTS 06/02/2026 02:28:10 PM
Update – Non-credible contingency event – NSW region – 02/02/2026
AEMO ELECTRICITY MARKET NOTICE.
Update – Non-credible contingency event – NSW region – 02/02/2026
Refer AEMO Electricity Market Notice 133232
On 02/02/2026 there was an unplanned outage of Vales Point Power Station Unit 5 and Unit 6.
The cause of this non-credible contingency event has been identified and AEMO is satisfied that another occurrence of this event is unlikely under the current circumstances.
AEMO will not reclassify this event as a credible contingency event.
Manager NEM Real Time Operations
Vales Point showing unplanned outage
You can tell it’s an unplanned outage by the time the outage happens, in this case at 1 pm, in the middle of the day. Planned outages would usually start at night due to lower demand.
Another price spike on the 7th Feb 2026
Further reading
Big swings in Australia’s electricity market have a frustrating effect on our power bills
8/2/2026
https://www.abc.net.au/news/2026-02-08/big-swings-in-australias-electricity-market/106305696