A New Game? Electricity Demand Down Nearly 10%

Today RenewEconomy writes about the energy market game-changer, falling demand – saying:

“Developers and network operators can tear up their business plans. And so can some renewable hopefuls too – the era of solar PV and price-conscious consumers is here.”

Forecasts Nearly 10% Lower

Today, AEMO (Australian Energy Market Operator) released a report conceding demand for 2011/12 was 5.7 per cent below forecast of just a year ago. Its updated predictions for 2012/13 are now 8.8 per cent below the forecast made 12 months ago.

There has been a dramatic consumer response to rising electricity prices. Electricity is now ‘a wildly unpredictable market’, the industry has suddenly become interesting, and difficult to manage.

Demand Lower In SA And Queensland

In SA, where there has been a greater penetration of rooftop solar PV than any other state, and a much higher pentration of wind, its demand forecasts have been cut by 12.2 per cent. In Queensland, another strong solar PV state, the variation is 10 per cent

How Did This Happen?

AEMO says through changes in technology, manufacturing, and the ‘social fabric’.

This is the third consecutive year of a demand downturn – the first two were blamed on the GFC and floods but with the third year AEMO realised that this is about significant change in our energy demand.

“People are saying yes I can have a good standard of living but do I need four plasma TVs all on standby? People are conscious about how much they are paying for energy.”

The Future

AEMO’s latest ‘highest’ forecast is a full 20 per cent below Origin Energy’s estimate of just four months ago.

This will affect the review into the Renewable Energy Target being undertaken by the newly created Climate Change Authority later this year AND the business plans of all energy suppliers.

RenewEconomy is an interesting read