Move over iron ore and coking coal, that’s not a price spike, THIS is a price spike. In the next hour, the spot price of electricity is about to jump 50-fold to nearly $14,000/MWh, the market cap price, according to the national regulator, the Australian Energy Market Operator (AEMO).

From 3.30pm today, the AEMO is warning it may have begin “load shedding” – cutting the power in a series of rolling blackouts – in New South Wales, with energy demand predicted to hit record levels.

Over the last seven hours, as the temperature began rising and air conditioning increased demand, during the course of Friday, the price has fluctuated from $105/MWh at 7am up to $339/MWh. Demand so far peaked at 13,825.11MW at 2.40pm, when the price, surprisingly, was just $111MW/h.

The AEMO pulled forward its predictions on peak demand by an hour, from 4.30pm to 3.30pm.

In the chart below from the AEMO website, the thin blue line above is demand, the dark lower line the spot price. The price spice is the dotted line. Tomorrow, AEMO is predicting the price will hit $14,000MW/h for even longer, between about 2pm and 7.30pm on Saturday.

With the South Australian and federal governments currently bickering over supply and prices following a series of recent blackouts in the state, here’s a quick primer on how the national electricity market (NEM) works.

The NEM has five trading regions: NSW and the ACT, Victoria, Queensland, South Australia and Tasmania. They’re interconnected via extra high voltage transmission lines that are meant to offer enough transfer capacity to keep wholesale prices fairly even across the regions.

The NEM is a gross pool market that’s constantly traded, with demand matched with generators in five minute periods. Those prices are averaged into 30 minute blocks to set the spot price.

The maximum spot price is $14,000/MWh (the market price cap) and floor price is -$1,000/MWh. The negative spot price means generators to pay to stay online because it’s cheaper than shutting down and re-starting a plant.

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