National electricity market suspended as NSW residents told to conserve power to reduce blackout risk

The Australian Energy Market Operator (Aemo) took the drastic step of suspending the entire national electricity market for the first time in its history on Wednesday.

In the hours prior to the suspension, Aemo had issued a flurry of lack of reserve alerts at the level 3 warning for all the mainland states within the market.

On Wednesday evening, the NSW energy minister, Matt Kean, told Sydney residents to reduce usage between 5.30pm and 8pm to reduce the risk of blackouts.

The latest Aemo forecasts for potential shortfalls in supply cited 8.30pm as a period of concern and flagged a possible intervention to order more generation as late as an hour earlier.

The market scheme to pay big energy users to cut their power use had also been activated in NSW on Wednesday, Aemo said.

Significant shortfalls in Victoria, Queensland and South Australia were avoided on Wednesday but more were forecast for Thursday.

Both the commission and the regulator had in the past day reiterated the importance of generators providing supply to the tight market, even with price caps of $300/MWh now imposed on all five states.