The Australian Energy Market Operator (AEMO) today said its 2022 Electricity Statement of Opportunities report has identified “electricity reliability concerns” in South Australia, Victoria, New South Wales and Queensland that require an “urgent response”.

The annually-released report uses market data to identify what combination of circumstances would see electricity demand outstrip supply.

AEMO said the report shows 14 per cent of the NEM’s (National Electricity Market) capacity will be withdrawn in the next decade due to the retirement of coal-fired power plants.

Considering “only existing and committed projects”, AEMO forecasts that South Australia will face “reliability gaps” in 2023-24, followed by Victoria in 2024-25.

Gaps are forecast across all NEM states before 2031-32.

“The report reiterates the urgent need to progress generation, storage and transmission developments to maintain a secure, reliable and affordable supply of electricity to homes and businesses,” AEMO CEO Daniel Westerman said.

“Forecast reliability gaps have emerged across NEM regions due to considerable coal and gas plant closures, along with insufficient new generation capacity commitments needed to offset higher electricity use.”

Westerman said the looming withdrawal of capacity will “challenge the transmission network’s capability to meet reliability standards and power system security needs”, unless further investment is made into the grid.

For this coming summer, AEMO says there are “supply risks” across eastern Australia.

But it also says 800 megawatts more capacity from a range of technologies is forecast to be operational this summer than was available last summer.

Westerman said should 3.4 GW of anticipated generation and storage projects, alongside Integrated System Plan transmission projects, be delivered to their current schedules, then reliability standards would be met in all regions’ markets until later in the decade when more large thermal generators exit.

South Australia managed to avoid blackouts during June’s national energy crisis despite several warnings from AEMO about electric supply crunches.

AEMO eventually had to suspend the NEM on June 15, describing it as “impossible to continue operating”, before reinstating it on June 22.

Premier Peter Malinauskas said at the time the country was witnessing a “market failure on a grand scale across the National Electricity Market” that was occurring “in a way that I think a range of policymakers should be deeply ashamed of”.

-With AAP