Electricity contracts for delivery in 2019 were trading at more than $92 per megawatt hour in Victoria and $108/MWh in South Australia a year ago, when SA and NSW had just suffered power shortages and the closure of Victoria's Hazelwood power station loomed.

Contracts for 2019 have since fallen to $82.90 in Victoria and $94.36 in SA, while contracts for delivery in Victoria in 2020 and 2021 are trading at $76/MWh and $69/MWh and contracts for 2020 and 2021 in SA are trading at $86/MWh and $85/MWh.

The trend is the first hint that the energy crisis that startled policymakers into action in 2016 may be starting to ease, and is consistent with the Finkel review, AEMO's advice to the federal government and the Australian Energy Markets Commission's annual review of electricity prices.

"As we have got through the summer people are a bit more confident and that's probably having an effect on prices," Mr McManus said. But he stressed that confidence in the electricity market "can turn on a dime" if something goes wrong.

After the closure of several coal fired power stations in the last couple of years, AEMO reported last September that SA and Victoria faced a potential shortfall of 1000 MW over the summer without further action.

ASX electricity futures prices have eased as confidence returns to the market NEMReview/GlobalRoam

Hydro, wind and solar

AEMO marshalled 1150 MW of "demand response" capacity - customers agreeing to curtail load and energy back to the grid from solar panels and batteries during supply squeezes - for the summer and leaned on energy companies to re-open more than 800 MW of inactive gas plant to create a reserve capacity larger than Hazelwood's 1600 MW.

Meridian said a month ago it had bought three hydro power stations in NSW - Hume, Burrinjuck and Keepit - from fellow New Zealand group TrustPower for $168 million and signed long term power contracts to support construction of TILT Renewables' Salt Creek wind farm in southwestern Victoria, Total Eren's 200 MW Stage Kiamal Solar Farm in northwestern Victoria and CWP Renewables' 135 MW Crudine wind farm in NSW.

Mr McManus said at the time the deals were consistent with landmark power purchase agreements last year which set the price of wind power in long term contracts at about $52/MWh and the price of solar power at under $70/MWh - prices that until that time hadn't been expected until well after 2020.