Australian Energy & Environmental Market Update - October 2026

Australian Energy & Environmental Market Update - October 2026

Key market developments in October

• Wholesale electricity prices rebounded sharply in October, rising 73% month-on-month to $91.19/MWh as stronger demand coincided with softer renewable generation.
• Variable renewable energy generation eased by 2% in October, underpinned by weaker wind (-10%) and utility solar (-3%) output despite strong growth in rooftop solar generation (+8%).  
• Baseload futures delivered mixed results across the NEM, with front-end contracts continuing to strengthen as Cal27 prices rose across all regions.
• The LGC market softened in October, with lower trading activity and easing prices as participants awaited clarity on future demand drivers, particularly from data centres and evolving policy settings.
• STCs remained broadly stable, while VEECs recorded the largest decline amid policy and election uncertainty. ESCs softened modestly on increased selling pressure, and PRCs fell sharply as strong certificate creation weighed on prices.
• In market news, consultation closed on the design of the next LTESA tenderfor 1.5 GW of firming capacity in NSW, while jurisdictions across Australia moved to tie new data centre demand to renewable generation and firming capacity.