Demand for electricity declines

According to the latest pitt&sherry Carbon Emissions Index (CEDEX), the demand for electricity supplied by the National Electricity Market (NEM) generators has continued to decrease steadily. CEDEX has been providing the most accurate early indicators for key greenhouse gas emission trends in Australia since 2007.

Demand for electricity supplied by NEM generators continued the steady fall in September, which has now been continuing for two years. The latest CEDEX indicates that the downward trend continues to be lead by lower consumer demand.

By the end of September, all business electricity consumers would have received two monthly bills at the higher price, including the cost of greenhouse emissions. Most household consumers would have received one bill with a substantial proportion of consumption at the higher price.

According to Dr Hugh Saddler, Principal Consultant, Energy Strategies, pitt&sherry, “If consumers respond to clear evidence of higher prices, then we should expect to see further reductions in seasonally adjusted consumption over the next few months.”

“In Victoria, brown coal generation fell to its lowest monthly level since December 2001 and the average capacity factor for all brown coal generators for the month was only 67%,” he added.

Renewable energy plays a significant role in reducing greenhouse gas emissions and is an essential part of Australia’s low emissions energy supply. In Victoria, the billion-dollar Macarthur wind farm came online for the first time. The initial output was very small but when complete, at 420 MW, it will be the largest wind farm in the Southern Hemisphere. 

In NSW, total output from black coal generators fell to the lowest monthly level since December 2010 and the average capacity factor for the month was only 57%. Even so, imports from both Victoria and Queensland also fell.

South Australia’s Northern Power Station came back online in September, earlier than had been expected when it went offline in early July. However, it supplied only 6% of the state’s demand, compared with 65% from gas, 28% from wind and net zero from interconnectors.

For the year in South Australia, 26% of energy demand was provided by wind; 18% by local coal, 49% by gas and 7% by the interconnector from Victoria.

“This data makes it clear that local coal competes mainly with brown coal imports from Victoria via the interconnector,” said Dr Saddler.

Queensland’s coal-fired annualised power generation has remained roughly constant for the past year during which time the capacity factor for all coal power stations together has averaged only 55%.

According to Dr Saddler, “This was achieved with the help of exports to NSW, which totalled 10% of electricity supplied within the state by NEM generators over the past year. Therefore, it is not surprising that the most recent Statement of Opportunities released by AEMO in late August concluded that Queensland would require no new generating capacity until 2020.”