Research Team
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Associate Professor Christina Nikitopoulos Sklibosios, Dr Muthe Mathias Mwampashi, Dr Alan Rai, Dr Otto Konstandatos
Sustainable Development Goals
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11. Sustainable Cities and Communities
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7. Affordable and Clean Energy
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13. Climate Action
- Posted on 12 Feb 2024
- Updated on 4 Sep 2026
- 4-minute read
Following ambitious renewable energy targets set by state and federal governments to achieve carbon neutrality by 2050, Australia is leading globally in the transition to renewable energy generation. This research explores how the rapid uptake of wind and solar generation has impacted spot electricity prices in the Australian National Electricity Market.
The challenge
According to the Clean Energy Australia 2025 report, renewable energy accounted for 40 per cent of Australia’s electricity generation in 2024, supported by strong investment in large-scale renewable generation, battery storage, and rooftop solar. This capacity should come as no surprise, with our sunny climate and stretches of coastline not only good for tourism: but solar and wind energy generation. While the use of VRE has great potential to lower emissions and energy prices in Australia, this rapid uptake is not without concerns: with the Australian National Electricity Market (NEM) facing challenges in the assessment and management of electricity price volatility.
This research explores the impact of wind and solar generation on electricity price dynamics in the NEM. The research team aim to uncover the challenges VRE presents to the stability of electricity prices – uncovering evidence to support policy adjustments that better support Australia’s transition to net zero by 2050.
Solution
Exploring this issue, the research team analysed the emerging trends in Australian wholesale electricity prices – with a particular focus on solar and wind energy in New South Wales, Victoria, Queensland, South Australia and Tasmania. The team assessed daily data from NEM; modelling prices and volatility simultaneously, while also taking into consideration the influence of other variables (such as energy consumption, gas prices and cross-border electrical grid interconnectors).
Outcome and impact
The research and subsequent findings present an evidence base to support government in making policy adjustments to increase the correlation between VRE output and electricity demand. In addressing this issue, the research team suggest:
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Increased investment in fast-start, firm, and flexible (dispatchable) energy sources to effectively counterbalance the fluctuating nature of VRE output – particularly in coal-reliant regions.
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Two-sided market reforms to increase market flexibility; allowing supply and demand sides to participate in the price setting process (not just suppliers).
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Small-scale renewable energy schemes and state-based policies to support PV-plus battery systems – enabling owners of rooftop solar panels to store extra generation during the day and export later in the evening to meet peak demand.
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Cross-border interconnectors to solve the intermittency of variable renewable energy – allowing states to pool and share their available generation capacities.
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Appropriate measures to curtail rooftop solar generation, especially via dynamic/flexible export management, to effectively absorb all excess rooftop generation and maintain system security.
Collaborate with us
Find out about research collaboration with the UTS Business School.
Research Outputs
Journal articles
Alfeus, M., Mwampashi, M.M., Nikitopoulos, C.S. & Overbeck, L. (2026). Stochastic modelling and forecasting of wind capacity utilization with applications to risk management: The Australian case: A pre-registered study. Pacific Basin Finance Journal, 91, Article 103310. https://doi.org/10.1016/j.pacfin.2026.103310
Mwampashi, M.M., & Nikitopoulos, C.S. (2026) Beyond the Mean: Examining Electricity Spot Price Distribution in Australia. The Energy Journal, 47(2), 209-254. https://doi.org/10.1177/01956574251369484
Alfeus, M., Mwampashi, M.M., Nikitopoulos, C.S. & Overbeck, L. (2025). Stochastic Modelling and Forecasting with Applications to Wind Derivatives: The Australian case. Pacific Basin Finance Journal, 91, Article 102769. https://doi.org/10.1016/j.pacfin.2025.102769
Mwampashi, M.M., Nikitopoulos, C.S., & Rai, A. (2024). From 30- to 5-Minute Settlement Rule in the NEM: An Early Evaluation. Energy Policy, 194, Article 114305. https://doi.org/10.1016/j.enpol.2024.114305
Mathias Mwampashi, M., Sklibosios Nikitopoulos, C., Rai, A. & Konstandatos, O. (2022). Large-scale and rooftop solar generation in the NEM: A tale of two renewables strategies. Energy Economics. 115, Article 106372. https://doi.org/10.1016/j.eneco.2022.106372
Mathias Mwampashi, M., Sklibosios Nikitopoulos, C., Konstandatos, O. & Rai, A. (2021). Wind generation and the dynamics of electricity prices in Australia. Energy Economics, 103, Article 105547. https://doi.org/10.1016/j.eneco.2021.105547
Media
Mashhadi Rajabi, M., Sklibosios Nikitopoulos, C. & Linnenluecke, M. (2025, November 20). The cost of power: how can Australia build a resilient clean energy market? The Policymaker. https://thepolicymaker.appi.org.au/the-cost-of-power-how-can-australia-build-a-resilient-clean-energy-market/
Nikitopoulos, C. & Mwampashi, M. (2023, March 8). First look at the new settlement rule of Australia’s electricity market, has it worked? The Conversation. https://theconversation.com/first-look-at-the-new-settlement-rule-of-australias-electricity-market-has-it-worked-200647
Sklibosios Nikitopoulos, C., Rai, A. & Mathias Mwampashi, M (2022, January 19). 4 ways to stop Australia’s surge in rooftop solar from destabilising electricity prices. The Conversation. https://theconversation.com/4-ways-to-stop-australias-surge-in-rooftop-solar-from-destabilising-electricity-prices-173592
Booth, E. (2021, March 16). Gone with the wind: how wind power has affected electricity prices and volatility. Energy Magazine. https://www.energymagazine.com.au/gone-with-the-wind-how-wind-power-has-affected-electricity-prices-and-volatility/
Mazengarb, M. (2020, December 7). Wind lowers energy prices, but adds to volatility without firming. Renew Economy. https://reneweconomy.com.au/wind-lowers-energy-prices-but-adds-to-volatility-without-firming-94563/
Christina Nikitopoulos Sklibosios
Associate Professor, Business School
Dr Muthe Mathias Mwampashi
Dr Alan Rai
Dr Otto Konstandatos
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