Solar panels, energy efficiency, high utility prices, are causing slump in demand for coal powered electricity
Power industry in the dark as demand wilts WA Today October 19, 2012 – “…… Demand slump The process itself is clear enough. Higher prices are prompting people to use less power, whether at home or at work. The higher dollar has forced some energy-intensive manufacturers to reduce output or shift abroad.
Solar panels sprouting on roofs at the pace of about 300,000 homes a year and more insulation batts underneath them are also curbing demand, particularly at peak times. Buildings are also much more energy efficient.
Tony Wood, energy program director at the Grattan Institute, said
nobody had done serious modelling on the relative contribution of
those factors to the demand slump. And some of those shifts may be
temporary, particularly if a hot summer sets in, prompting millions of
air-conditioners to be turned on.
The intense interest in electricity prices, though, has already
affected behaviour, he said.
“Just the sheer publicity and the forward views that prices are going
up, means that individuals and particularly commercial organisations
see greater value now in implementing programs or policies that could
increase their energy efficiency,” Mr Wood said.
The arrival of less power-hungry appliances is also playing a part,
said Professor Ray Wills, an advisor to the Sustainable Energy
Association of Australia.
For instance, he notes, consumers were shifting from desktop
computers, which use about $80 worth of power a year, to laptops,
which consume about a quarter as much. Now tablet computers are fast
replacing both, and use just $4 worth of power: “The exciting thing is
those devices are coming with storage – they don’t need 24/7 power.”
That’s more bad news for the power industry. According to the
Productivity Commission on electricity network regulations out today,
less than 40 hours of peak electricity consumption – or less than 1
per cent of the time – delivers about 25 per cent of annual household
electricity bills. Earlier this week, Queenland’s Ergon Energy
announced 500 job cuts while EnergyAustralia’s Yallourn power station
halted output at one of its four units in response to a 10 per cent
demand drop from average highs of several years ago.
In short, the market is doing its job, with higher prices resulting in
a demand response. The signal for suppliers is also clear, said
Professor Sandiford: shutter excess generation capacity.
“The big incumbents have never expected the market to send such a signal.”