Predicted Shortfall of LGCs for 2019

LGC’s remain relatively elevated at ~$50/certificate. Volumes are being traded whilst liquidity is still being indicated as reasoning for increased prices for CAL19 certificates market.

The Clean Energy Regulator came out on Thursday 31 October and announced based on forecasts and certificates created thus far this year, there is likely to be a shortfall in CAL19 certificate creation by 2 million certificates which has resulted in an uplift in prices.

Despite this, we are seeing continued strong wind and solar generation around the NEM which will continue to have a positive impact on creation levels, with fewer interconnector constraints and transmission constraints intra-regionally impacting energy flows. Tas Hydro’s fleet of run-of-river hydro continues to run hard with a significant volume of water in storage no doubt being reserved for Summer of 2019/2020. Additionally, Snowy Hydro’s water catchment levels also continue to increase leading into Summer.

The Bureau of Meteorology is still predicting a warm and dry Summer 2019/202 which should result in greater demand levels around the NEM allowing for greater generation volumes from renewable sources.

If you would like to know more about the LGC market or need to procure LGC’s for your portfolio, please contact Edge on 07 3905 9220.