Hot weather and hungry datacentres lift Australia’s energy demand to record highs but batteries quell prices
Summary
Australia’s electricity use reached new high levels in early 2026 due to more datacentres and hot weather. At the same time, falling gas use and more battery storage helped keep electricity prices lower than last year.Key Facts
- Electricity demand hit a record 25 gigawatts (GW) in the first quarter of 2026, up 1.2% from last year.
- New datacentres caused electricity use in New South Wales to rise 1.8%, with datacentre demand growing 18% in one year.
- Victoria also saw increased grid demand, setting a new record when temperatures reached over 43°C.
- Extreme heatwaves led to higher demand for air conditioning, especially in Adelaide where use more than doubled.
- Renewable energy made up 46.5% of all power generation in the national electricity market during this period.
- Large-scale battery storage capacity more than doubled, reaching 4,445 megawatts (MW).
- Batteries store excess solar and wind power during the day and release it in the evening, helping to lower prices.
- Gas power generation fell 24% compared to last year, reaching its lowest level since 1999, and coal use also declined.
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