The past few months have seen close attention paid to the curtailment of renewable generators across the NEM. We have seen AEMO limit the output of solar generators in North Western Victoria to manage voltage issues, the continuing story of wind curtailment in SA as a result of system strength. In addition, solar farms are also turning off in SA (Tailem Bend) as well as in Queensland during negative price events, either to reduce their merchant exposure or to comply with Power Purchase Agreement conditions. So how many MWs are actually being curtailed from the grid?
Since July 2018 we have seen a total of ~4.1% of MW curtailment in the NEM, with generators facing on average 5.37% curtailment. Given all the noise in the market surrounding curtailments, interestingly average curtailments for generators have only risen by 0.19pp over the past 6 months, however, total MW curtailment have increased by almost 1pp. This suggests that the increases in curtailments over the past 6 months are being driven by larger volumes of MWs being curtailed from specific generators. We can see this in the chart which shows that Yendon Wind Farm, Childers Solar Farm, and Lake Bonney Wind Farm (Stage 2) have all seen increased curtailments over the past 6 months and also constitute 3 of the top 4 curtailed generators.
Solar also faces higher curtailment rates when compared to wind (6.36% to 3.64% respectively) and make up 7 of the top 10 generators curtailed.
There are two main factors that lead to the curtailment of renewables; AEMO interventions and market bidding.
AEMO interventions in the market resulting in curtailments of both solar and wind are highly localised and therefore applicable to specific generators. However, we are now also seeing more solar and wind generators remove capacity from the market during instances of negative pricing. Which has been especially prevalent recently in QLD.
We delve into the issues of curtailment and utilising flexible assets to minimise curtailment risks, increase MLFs and monetise flexible revenues in our Flexibility Fundamental course on 27 November 2019, more details here.