Electricity demand continues to grow across the national electricity market, up 0.9% in February compared with the previous corresponding period, with renewables accounting for over 46% of total generation, up 2.5% points on last year, Jefferies said in a Monday note.

The rise in renewables and storage, combined with expectations for coal to remain longer in the system, is driving continued moderation in forward electricity prices.

New South Wales and Queensland experienced an increase in demand, while South Australia and Victoria saw a decrease.

Earnings for both AGL Energy (ASX:AGL) and Origin Energy (ASX:ORG) are anticipated to remain in line with expectations for fiscal 2026, with potential downside risks occurring in fiscal 2027 from softer than expected default market offer and Victorian default offer prices, Jefferies said.

Jefferies reaffirmed its buy rating and price target of AU$12.76 on AGL Energy.

The firm also maintained its buy rating and price target of AU$13.03 on Origin Energy.

AGL Energy shares rose past 1% in afternoon trade Tuesday.