Interconnector Watch: Monday 31 August 2026
Two of the NEM's six interconnectors are binding right now, and the flow pattern points to Victoria as the pivotal transit region this morning. VIC-NSW (VIC1-NSW1) is exporting 968 MW north into NSW, sitting hard against its 891 MW export limit — effectively maxed out. Heywood (V-SA) is simultaneously binding on its import side, drawing 602 MW from Victoria into South Australia against a 482 MW export limit reference, indicating the interconnector is constrained near its transfer capability. Between them, Victoria is exporting to both neighbours at once, a classic squeeze that's consistent with VIC1's low $35.78/MWh price relative to NSW1 ($76.77/MWh) and the steep discount into SA1 ($14.15/MWh) and TAS1 ($11.88/MWh).
QNI (NSW1-QLD1) is flowing 1,084 MW from QLD into NSW, well within its -1,170 MW import limit and not binding, which is capping the NSW1-QLD1 price spread at a modest $13/MWh ($76.77 vs $63.76). Directlink (N-Q-MNSP1) is moving a small 49 MW from QLD to NSW, nowhere near its limits. Basslink (T-V-MNSP1) is carrying 388 MW from TAS1 into VIC1, comfortably inside its ~411-486 MW band and not binding — Tasmania's cheap generation ($11.88/MWh) is flowing north but the link still has headroom. Murraylink (V-S-MNSP1) is sitting idle at zero flow despite a 145 MW import limit, contributing nothing to SA's supply picture today.
The binding constraints on VIC-NSW and Heywood are the key price driver this morning: Victoria is unable to fully arbitrage away its discount to NSW because the export path north is capacity-constrained, while SA's ultra-low price reflects strong import reliance on a Heywood link that's also running near its ceiling. This leaves NSW1 as the highest-priced mainland region ($76.77/MWh) despite ample QNI headroom, suggesting the binding pressure is coming from the Victoria-NSW leg rather than Queensland flows. WA1, not synchronously connected to the NEM, is trading separately at $91.48/MWh with no interconnector linkage to the eastern system.
On constraints, no new system-normal binding notices have been issued for QNI or the Victorian links today. The active notices on file relate to North Queensland system strength (implemented 27 August, affecting Q-NIL constraint equations rather than current binding limits) and TAS1 contingency reclassifications from lightning activity in late August, both now reverted to non-credible status with no current impact on Basslink's operating envelope. Traders should watch for any renewed TAS1 lightning reclassification given the pattern earlier this month, as that would tighten Basslink limits and reduce Tasmania's ability to relieve the current VIC-SA squeeze.