Interconnector Watch

Six interconnectors are active across the NEM at 06:30 AEST, with two binding constraints shaping a pronounced east-to-west price gradient this morning. VIC1-NSW1 (Terranora/VIC-NSW) is hard against its export limit at 937.4 MW northbound — at 100% of its 937.4 MW export ceiling — pushing power from Victoria (–$2.50/MWh) into New South Wales ($79.00/MWh). That $81.50/MWh spread reflects the constraint directly: no additional Victorian generation can clear into NSW regardless of price signals, and the negative residue constraint NRM_NSW1_VIC1, which was invoked and then ceased on 4 April, remains listed as active in market notices — traders should note this may still carry settlement residue implications for the VIC-to-NSW direction. Murraylink (V-S-MNSP1) is also binding at –139.01 MW, at precisely its import and export limit, flowing from South Australia into Victoria. With SA priced at –$2.74/MWh, essentially the same as Victoria, the binding constraint here is locking in a flow rather than reflecting a meaningful price incentive — any relaxation would not materially alter SA's dispatch economics at current prices.

On QNI (NSW1-QLD1), 87.12 MW flows northbound from NSW into Queensland — a modest utilisation of roughly 14% of the 603.77 MW export limit — despite Queensland sitting $3.21/MWh higher than NSW at $82.21/MWh. The active constraint set Q-LCCP_8859, invoked following the unplanned outage of the Larcom Creek–Calliope River 275 kV line on 5 April, constrains both N-Q-MNSP1 and NSW1-QLD1 and is capping northbound transfer capability well below physical capacity. Directlink (N-Q-MNSP1) carries just 17 MW northbound, operating at roughly 53% of its 32.28 MW export limit and consistent with the same constraint set. The Larcom Creek outage is the dominant factor suppressing what would otherwise be stronger northbound flows given the QLD-NSW spread.

Basslink (T-V-MNSP1) flows 60 MW southbound from Tasmania into Victoria — approximately 24% of the 251.8 MW import limit — with Tasmania the highest-priced region on the NEM at $88.14/MWh against Victoria's –$2.50/MWh. That $90.64/MWh differential is substantial, and the relatively low Basslink utilisation suggests either an operational or market limit is preventing fuller exploitation of the spread; the interconnector is not reported as binding, so the constraint may be a scheduled or thermal limitation not captured in today's binding constraint flags. Heywood (V-SA) carries 399.54 MW westbound from Victoria into South Australia, operating at 77% of its 516.76 MW export limit and not binding. Given SA and VIC prices are near parity, this flow is likely driven by dispatch economics and FCAS requirements rather than a significant energy arbitrage opportunity. The overall picture is a NEM where the southern regions are price-suppressed and the Queensland and Tasmanian nodes are elevated, with constrained interconnector capacity — particularly the Larcom Creek outage on QNI — limiting the price convergence that unconstrained flows would otherwise deliver.