Hot weather and hungry datacentres lift Australia’s energy demand to record highs but batteries quell prices

More datacentres and warmer conditions helped push electricity demand to record highs in the first three months of the year, according to Australia’s Energy Market Operator, while growth in batteries kept average wholesale prices down. Electricity demand – from households, business and industry – reached record levels of 25GW in Q1 2026, an increase of 1.2% compared with the same quarter last year. Across the grid, this growth was offset by record output from rooftop solar. But in New South Wales, where datacentre demand grew 18% in one year, grid electricity demand grew by 1.8%, despite the rise in rooftop solar. Previous Aemo forecasts have suggested datacentre power demand could triple in five years , to exceed the energy used by electric vehicles by 2030. Grid demand grew in Victoria too, off the back of a near doubling in datacentre demand, Aemo’s quarterly report showed. The state also set a new record for all-time maximum power demand on 27 January, when temperatures topped 43C in parts of Melbourne amid an extreme heatwave. Two extreme heatwaves in January led to higher cooling requirements in most cities, especially in Adelaide, where demand for air conditioning more than doubled 2025 levels. Across the national electricity market, which supplies the eastern states and South Australia, renewable energy provided 46.5% of all generation – a new high for the first three months of the year. …