This paper examines the suspension of the Australian National Electricity Market (NEM) that occurred in June 2022. Our study aims to (i) identify the key factors leading to the market suspension, (ii) investigate the behaviour of market participants and price outcomes during this period, and (iii) provide important recommendations for policy and decision-makers related to avoiding or managing crises in wholesale electricity markets. We contribute to the literature by focusing on a severe market crisis event, thoroughly examining generator bidding, dispatch and spot price dynamics over different time periods around the suspension event. Our study examines these dynamics at a high degree of granularity, presenting results at the generator fuel level and for different sub-samples, including the pre-crisis period, the built-up of the crisis, the suspension period, and after the crisis. Our empirical findings highlight that policymaking, in particular the set level of the administered price cap, as well as a lack of reliable substitutes for fossil fuel generation, were leading causes for the suspension. Further, our analysis finds limited evidence of strategic bidding on average but does not deny its possibility at granular levels. Finally, we propose policy implications based on our findings to ensure a well-functioning NEM that can facilitate a smooth energy transition.

中文翻译：

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重新审视危机：NEM 暂停的实证分析


本文研究了 2022 年 6 月发生的澳大利亚国家电力市场 （NEM） 暂停的情况。我们的研究旨在 （i） 确定导致市场暂停的关键因素，（ii） 调查市场参与者在此期间的行为和价格结果，以及 （iii） 为政策和决策者提供与避免或管理电力批发市场危机相关的重要建议。我们通过关注严重的市场危机事件，彻底研究停赛事件前后不同时期的发电机投标、调度和现货价格动态，为文献做出贡献。我们的研究以高度的粒度检查了这些动态，展示了发电机燃料水平和不同子样本的结果，包括危机前时期、危机的积累期、暂停期和危机后。我们的实证研究结果强调，政策制定，特别是管理价格上限的设定水平，以及缺乏可靠的化石燃料发电替代品，是暂停的主要原因。此外，我们的分析发现战略竞价的平均证据有限，但并不否认它在细粒度层面上的可能性。最后，我们根据我们的研究结果提出了政策影响，以确保 NEM 运行良好，从而促进能源平稳转型。