Interconnector Watch: Tuesday 12 May 2026

At 06:30 AEST, no interconnector across the NEM is formally binding, but flow patterns and active constraint notices are shaping regional price spreads meaningfully. The dominant flow is on VIC-NSW (VIC1-NSW1), carrying 606 MW northbound from Victoria into New South Wales — roughly 43% of its 1,425 MW export limit, leaving substantial headroom. This flow is consistent with Victoria's lower spot price of $85.52/MWh against NSW at $97.65/MWh, a $12.13/MWh spread that is wide enough to incentivise export but not wide enough to push the link toward its ceiling. Heywood (V-SA) is carrying 138 MW westbound into South Australia, utilising just 23% of its 600 MW export limit; SA sits at $86.39/MWh, only $0.87/MWh above Victoria, so arbitrage pressure on this link is minimal.

QNI (NSW1-QLD1) is flowing 153 MW southbound into NSW and is sitting exactly at its current import limit of -153 MW, making it effectively binding on the Queensland-to-NSW import side. Despite this, QLD ($96.83/MWh) and NSW ($97.65/MWh) prices are nearly converged — a spread of just $0.82/MWh — suggesting the constraint is capping what would otherwise be a stronger northbound signal rather than producing a sharp price wedge. The active market notice N-AR_TX, stemming from the unplanned outage of the Armidale No. 3 330/132 kV transformer on 8 May, continues to restrict N-Q-MNSP1 (Directlink) capacity; Directlink is currently at zero flow against an 80 MW export capability, and the separately active N-MBTE_1 constraint from the Directlink No. 3 leg outage (from 5 May) compounds this. Traders should treat the QNI/Directlink corridor as operating under reduced effective capacity until the Armidale transformer is restored.

Basslink (T-V-MNSP1) is at zero flow, flat against its ±125 MW symmetric capability. TAS at $96.24/MWh is $10.72/MWh above Victoria, which would ordinarily support southbound export from Tasmania into Victoria; the flat flow suggests either a scheduling decision or operational headroom being preserved. Murraylink (V-S-MNSP1) is carrying a nominal 9 MW from Victoria into SA — well inside its 88 MW export limit and commercially insignificant at current spreads. The I-QN_550 constraint notice from 29 April relating to a QNI restriction during the Armidale–Sapphire 8E line outage remains listed as active in the market notices system; traders should verify with AEMO's NOS whether this constraint set remains invoked given the originally scheduled restoration date of 2 May has passed, as its status directly affects the effective QNI export limit from NSW into Queensland.

The overall picture is a NEM where inter-regional price spreads are moderate and no interconnector is crashing against its thermal limit, but the QNI corridor is operationally constrained by network outages rather than physical thermal limits. The Armidale transformer outage is the key network variable to watch today — any update to its restoration timeline will directly affect QNI capacity and, by extension, the NSW-QLD price relationship