Australian power crunch eases as coal-fired plants crank up

Australian coal-fired generators have brought 1900 megawatts (MW) of capacity back on line since Wednesday, the industry group that represents generators says, easing blackout risks that have plagued the market this week.

Eastern Australia has faced a power crisis since mid-May as around 25% of the market's 23,000 MW of coal-fired capacity has been off line for maintenance or due to unplanned outages.

Market conditions have improved in New South Wales, home to Sydney, which had faced the biggest threats to power supply this week, state treasurer Matt Kean said.

The Australian Energy Market Operator (AEMO) suspended the spot electricity market on Wednesday in a drastic step to secure power supplies after generators started holding back capacity that was incurring losses under price caps imposed by AEMO earlier in the week.

"AEMO have told us that the conditions in our energy system are much better," Kean told reporters in a televised media conference.

AEMO did not immediately respond to a request for comment.

"We are pleased to note that since Wednesday we have seen the return to service of some 1900 MW of coal plant previously under maintenance," the Australian Energy Council said in a statement.