October 7, 2026

Zembl's September 2026 Energy Market Wrap

Learn what drove the September energy market split: falling spot prices as solar hit records versus rising 2027 contract prices in every mainland state. Understand what's happening in the NEM, which factors to watch for summer, and what the shift in forward pricing means if your business contract is coming up for renewal in the next 12 to 24 months.

Written by

Zembl Energy Experts

Australia’s trusted business energy experts

Spot electricity prices fell again in September as spring solar broke records, but prices for 2027 contracts climbed in every mainland state. Here's what drove the split and what it means if your contract is coming up for renewal.

What influenced the market in September

September was Australia's second-warmest on record, with temperatures 2.71°C above the long-term average and rainfall 17% below average. Warm, dry spring conditions meant strong solar output and low grid demand, and wholesale spot prices (what generators are paid for electricity as it's produced) fell in most NEM states.

The forward market went the other way. Futures prices for 2027, which feed into the fixed rates retailers offer businesses, rose in all four mainland states while the Bureau of Meteorology's latest outlook pointed to a very strong El Niño peaking in late spring or summer.

For large energy users, it's a reminder that today's spot price and the price you can lock in for next year don't always move together.

What's happening in the NEM (National Electricity Market)

Every NEM state averaged below $65/MWh (per megawatt hour) in September, and Victoria, South Australia and Tasmania all averaged below $40/MWh. In August, Shell Energy's market report had NSW at $75.71/MWh, South Australia $71.62, Queensland $60.42, Victoria $60.40 and Tasmania $57.95. That's a clear fall in NSW and the three southern states.

Rooftop solar generated 2,975 GWh in September, 31.3% more than in August (Open Electricity data via PV Tech). At 12:30pm on 19 September, renewables supplied more than 80% of the grid's electricity for the first time. The next day, operational demand (electricity drawn from the grid after rooftop solar) hit a record low of 9,422 MW (independent analyst data via pv magazine).

NSW also has more storage for summer, with the 850 MW Waratah Super Battery reaching full commercial operation in September, almost a year after a transformer failure cut its output.

What we're watching

Summer heat: The Bureau expects above-average daytime temperatures across most of Australia from October to December, though it notes a strong El Niño doesn't guarantee strong local impacts. AEMO's 2026 Electricity Statement of Opportunities found no reliability gaps before 2030, but enough supply on paper doesn't rule out expensive evenings in a heatwave.

Gas: Draft laws released on 10 September would require LNG exporters to supply up to 20% of their exports to the local market from 1 January 2028 (Minister for Resources). Export prices are climbing. The ACCC's LNG netback price, a measure of what suppliers could earn by exporting, rose from $20.47 a gigajoule (GJ) in August to $25.74/GJ in September, with Reuters reporting that lost Qatari supply has pushed up Asian LNG prices. Local prices haven't followed yet: Victorian gas futures for October to December were $9.00/GJ on 5 October (ASX Energy).

Rule changes in progress: The federal energy department's draft laws for the NEM Review include a Market Making Obligation to improve liquidity and price transparency in electricity contracts, with submissions closing on 13 October. Separately, the Australian Energy Market Commission is consulting on rule changes so large connections such as data centres pay their share of network upgrades, rather than other customers.

Mid-scale solar: Solar systems between 100 kW and 1 MW installed from 1 October can now create small-scale technology certificates, which reduce the upfront cost, with applications due to open in mid to late November (Clean Energy Regulator). The trade-off is no Renewable Electricity Guarantee of Origin certificates for the first five years.

What this means for energy buyers

Last month we said electricity prices were sitting around five-year lows. That still holds for spot prices, with AEMO reporting the lowest June-quarter average since 2020 (Quarterly Energy Dynamics) and September lower again in most states. It no longer holds as well for contracts. The 2027 prices behind fixed business offers have climbed since late July in NSW, Queensland and Victoria.

A cheap September doesn't mean contract prices will keep falling. Futures could ease if summer is mild and new batteries keep evening peaks in check, but the market is pricing in more summer risk than it was a month ago.

If your contract expires in the next 12 to 24 months, get current pricing in front of you now rather than close to expiry, particularly in NSW. Zembl can take your requirements to market and show you where pricing sits today, so you can decide when to lock in.

Sources

_{ACCC. LNG netback price series.}_{https://www.accc.gov.au/inquiries-and-consultations/gas-inquiry-2017-30/lng-netback-price-series}

_{AEMO. 2026 Electricity Statement of Opportunities (media release).}_{https://www.aemo.com.au/newsroom/media-release/2026-esoo}

_{AEMO. Quarterly Energy Dynamics Q2 2026 (media release).}_{https://www.aemo.com.au/newsroom/media-release/qed-q2-2026}

_{ASX Energy. Cal base futures.}_{https://www.asxenergy.com.au/}

_{Australian Energy Market Commission. Cost recovery for network augmentations.}_{https://www.aemc.gov.au/rule-changes/cost-recovery-network-augmentations-package-1}

_{Bureau of Meteorology. Australia in September 2026 (monthly climate summary).}_{https://www.bom.gov.au/clim_data/IDCKGC1AR0/202609.summary.shtml}

_{Bureau of Meteorology. Long-range forecast, October to December 2026.}_{https://www.bom.gov.au/climate/ahead/outlooks/archive/20260924-outlook.shtml}

_{Clean Energy Regulator. Mid-scale solar.}_{https://cer.gov.au/schemes/renewable-energy-target/small-scale-renewable-energy-scheme/small-scale-renewable-energy-systems/mid-scale-solar}

_{DCCEEW. NEM wholesale market settings regulatory reforms consultation.}_{https://consult.dcceew.gov.au/national-electricity-market-wholesale-market-settings-regulatory-reforms}

_{Minister for Resources (joint release with the Ministers for Climate Change and Energy, and Industry). Securing more affordable gas for Australians.}_{https://www.minister.industry.gov.au/king/media/securing-more-affordable-gas-australians}