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Declining electricity consumption in Australia

July 25th, 2013

I missed this when it came out a few weeks ago, but the Australian Energy Market Operation (AEMO) has released new forecasts of electricity demand to 2020. The forecasts represent a further reduction on the big cuts in estimated demand made between 2011 and 2012. In 2011, the medium forecast was for nearly 250 000 GWH by 2020, up from 200 000 in 2010. The latest medium forecast is 211 000 GWh for 2020, and the low forecast stays below 200 000 out to 2022-23. These forecasts would be even lower if it were not for three large export LNG projects in Queensland.

Even more striking is the forecast for residential and commercial consumption per persom. In much of the debate around energy issues, it is assumed that increases in living standards must go hand in hand with higher consumption of all forms of energy. But AEMO, assuming moderate rates of economic growth, is predicting that consumption per person will drop to 6000 KwH per year by 2020. In 2005, it was around 7200 KwH, so that’s a drop of more than 15 per cent. Over that time, income per person is likely to rise by around 30 per cent.

The AEMO measures don’t include rooftop solar, but they do include large-scale renewable energy (wind and grid-connected PV). Current policy calls for an additional 20 000 GWh of large-scale renewables by 2020, which would imply a significant reduction in energy-related CO2 emissions over the next decade.

Of course, a lot of this is the fortuitous result of high electricity prices, driven mainly by distribution costs. But it’s certainly an impressive demonstration that lower energy consumption does not mean lower living standards.

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  1. Ikonoclast
    July 27th, 2013 at 17:55 | #1

    @Ronald Brak

    Maybe when we can’t meet normal range environmental challenges it’s nature’s way of telling us it’s time to shuffle off this mortal coil.

  2. July 27th, 2013 at 21:53 | #2

    @Ronald Brak
    Re the warning systems you propose, the issue I have with measures like this – similar to the AMA subsidised AC measure – is that they are individualised responses to social problems. They don’t prevent or forestall the problems. As you are a libertarian, I don’t know if you will be prepared to listen to this, but public health is not an area where free market and individualistic principles work well (personally I think that they don’t work well in most areas of life, but I won’t get into that argument here).
    However intruments that measure and record temperatures over the course of the day have been used in community development projects to raise people’s awareness of temperature conditions in their houses, accompanied by programs to help them address and improve these conditions.

  3. BilB
    July 27th, 2013 at 23:59 | #3

    I’m going to take your advice Ronald Brack as a new enterprise that I am a part of is designing electronics with integral wifi to go into every home and ask our EE to build in that very feature. I will be doing it for a very different reason, but the outcome will be what you call for.

    The Fins were onto this style of intitative over a decade ago by fitting vital sign sensors to the matresses of vulnerable people for remote monitoring.

    Cell phones should be able to perform this task, but there are issues with that.

    Are you Libertarian Ronald Brack? I hadn’t thought that to be the case, particualrly as you list humour as one of your hot buttons,….and demonstrated that with the image of a young Homer Simpson being given a bath.

  4. BilB
    July 28th, 2013 at 00:14 | #4

    Talking Heads, Hermit, are destined to say that “no-one saw this climate change coming”, “why weren’t we better prepared” and “why did no-one do anything to prevent it”.

    “Talking heads on TV will say ‘nobody saw it coming’ or ‘it’s just a glitch’. ”

    The Alan Jones will just change the subject and refuse to talk about their involvement in denying CC. That is how psychopaths operate, and I have lots of first hand experience with these a**e holes.

  5. rog
    July 28th, 2013 at 05:41 | #5

    In an amazing mea culpa the Australian Coal Association states

    It will be virtually impossible to limit global temperature increases to two degrees without carbon capture and storage technology.

  6. Ikonoclast
    July 28th, 2013 at 06:01 | #6

    @rog

    CCS is a non-starter. The technical problems and energy costs (and thus financial costs) of CCS are prohibitive. As the Financial Review openly admits “There are still no commercially viable projects in Australia or ­anywhere in the world”.

    SmartPlanet says;

    “The cost of building a new power plant equipped with CCS has been escalating rapidly along with the costs of all construction commodities (like oil and steel). And those costs are now rising above the cost associated with power generation from renewables…

    …one 2011 study from the Global CCS Institute, a group whose membership “covers more than 80 percent of the world’s CO2 emissions from energy and industrial sources,” offered a cost range of $38 to $107 per tonne of captured CO2, which isn’t terribly helpful.”

    The U.S. Department of Energy estimates that the energy requirements of post-combustion carbon capture reduce the plant’s efficiency by 20 to 30 percent. A 2007 study from MIT found that a CCS retrofit of an existing subcritical pulverized coal plant would reduce the plant’s electrical output by more than 40 percent. Reduced energy output means higher prices for the energy that’s not consumed by the plant itself.”

    It’s clear that renewables come in far better than that. The future is with renewable power if we have a future left at all.

  7. BilB
    July 28th, 2013 at 08:03 | #7

    Here is the grid energy industry waking up to their situation

    http://www.nytimes.com/2013/07/27/business/energy-environment/utilities-confront-fresh-threat-do-it-yourself-power.html?nl=todaysheadlines&emc=edit_th_20130727&_r=0

    Five years ago before electricity price rises began I was arguing for a 3 cent per unit levy on electricity retail rates to provide an investment pool for renewable energy infrastructure of the type that we will need in the not too distant future to complement distributed solar and to maintain the viability of the grid distribution structure.

    The only comment this proposal got was “the last thing we need is a slush fund for inefficient industry players”. John Quiggin failed to give this possible direction any consideration at all prefering to push the argument for a “market driven approach underpinned by targets (RET)”.

    So here we are these years and several governments later and the RET has been effective but the “market approach” has decayed into an excuse by electricity distributors to gouge the public with an “advised” electricity price escalation programme which has led to funds intended to be directed in new renewable energy generation infrastructure remaining in the hands of the energy retailers setting off a “buyup the competition” battle, as all the while the CO2 clock keeps ticking over as the atmosperic concentration steadily builds unabated.

    Good work people.

    Now we get to the ludicrous situation where the reason for all of this, preventing Global Warming, is chucked out the window in favour of protecting profits for the grid industry which is now richer than it has ever been in its long history, with a wealth made possible by the one thing that they will now attempt to crush.

    I’m imaging a chant for a renewable energy rally

    What do we need?

    Politicians with brains!

    How do we get them?

    By crushing Fox News!

    Fn. It is kind of interesting, the similarities in the arguments of the US grid players to the ones being mouthed by our Liberal State Premiers. I sense a degree of global coordination to this.

  8. BilB
    July 28th, 2013 at 08:24 | #8

    I suspect the influence of climate change, albeit to the contrary effect anticipated (for now)

    ” so that’s a drop of more than 15 per cent”

    If you examine the BOM Southern Oscillation Index Graph Archive you might find an expanation for an overall drop in electricity consumption with the extraordinary series of elevated La Nina events the we have had in the past few years. High humifity smoothes out temperature fluctuations reducing temperature peaks both high and low that drive the need for excess air conditioner useage. Couple this with unprecedented electricity prices and a winding down of manufacturing, and you might have the basis for the temporary 15% drop in electricity consumption over the considered period.

  9. July 28th, 2013 at 08:27 | #9

    Val, a properly functioning public health system is a great enhancer of liberty. One has only to compare countries with good public health systems to those without to see that. For example people in the US with health conditions such as diabetes that go untreated have their options, and thus their freedom, severely constrained by their physical dehabilitation.

  10. July 28th, 2013 at 08:43 | #10

    BilB, glad to hear you are taking steps to prevent old people carking it in the heat:

    http://cleantechnica.com/2013/03/01/grandparents-carking-it-in-the-heat-install-renewable-energy/

    I don’t remember a picture of a young Homer Simpson being given a bath, but then my mental functions have been deteriorating. But I would like to point out that my mental deterioration is not the only reason I am a libertarian. I have always been in favour of individual freedom and as a result I approve of robust public health and education systems, strong environmental protection, and public assistance for those suffering from addictions and disabilities in order to maximise the total amount of freedom people have.

  11. BilB
    July 28th, 2013 at 09:02 | #11
  12. July 28th, 2013 at 09:05 | #12

    @Ronald Brak
    Hi Ronald, maybe you’re a different kind of libertarian than the ones I’ve come across before! I have nothing against liberty, it’s the over-emphasis on individuals that I have a problem with. We have to look at the whole as well as the parts – social systems and ecologies as well as individual freedoms.
    No matter what Margaret Thatcher said, there is such a thing as society, and we’re all part of it (and also part of the ecology). We’re interdependent and we have to care for each other and the earth in order to flourish. If you agree with all that, you may be a libertarian, but not as I know it!

  13. BilB
  14. July 28th, 2013 at 09:33 | #14

    BilB, I see where the confusion comes from. That isn’t actually Homer Simpson, that’s his half brother. The one that was born of a carny queen and became CEO of a US car company and used Homer to engineer a crash in his company’s stock price so he and his cronies could make hundreds of millions from shorting its stock. He pretended he had been ruined, but I saw through his ruse. Since when has a US CEO ever been rendered destitute by running a company into the ground?

  15. July 28th, 2013 at 09:35 | #15

    Val, there may be a few libertarians around who haven’t really thought things through.

  16. Will
    July 28th, 2013 at 12:10 | #16

    BilB :
    Talking Heads, Hermit, are destined to say that “no-one saw this climate change coming”, “why weren’t we better prepared” and “why did no-one do anything to prevent it”.
    “Talking heads on TV will say ‘nobody saw it coming’ or ‘it’s just a glitch’. ”
    The Alan Jones will just change the subject and refuse to talk about their involvement in denying CC. That is how psychopaths operate, and I have lots of first hand experience with these a**e holes.

    You forgot the final stage: where the pundits all turn on a dime in much the same way as a flock of birds wheels in flight, provide “evidence” that Team Conservative has known about and been acting against AGW since it was discovered (including Reagan and Thatcher PBUThem), and that all the current climate problems are the fault of the “left wing” (defined as any ideology not radical rightist). I know, beyond a shadow of a doubt, that this will happen at some point in the future.

  17. Hermit
    July 28th, 2013 at 13:16 | #17

    On ABC1 Thursday night Dick Smith is going to point out that oil is getting harder to find and replace. Perhaps this will strike a chord with those who are dismissive of climate change. A possible link to coal emissions is that if it gets harder to move people or stuff then there may be less demand for stationary energy a.k.a. recession. Meanwhile we’ll probably squander our best gas reserves in the next 20 years. Under this scenario peak liquid fuel supply will drag coal demand down with it so combined emissions decline as will GDP.

    Thus we need to steadily decarbonise climate change or not. The question is whether we are taking a least cost approach. Unfortunately our default position seems to be as we import more oil we’ll pay for it by exporting more coal. In global CO2 terms it makes our slight reduction in electricity related emissions almost irrelevant, in billions of tonnes about 0.015 compared to 32.

  18. BilB
    July 30th, 2013 at 09:42 | #18

    I restate my point at #2/7 that the levy system for a sustainable energy infrastructure rebuild was the right way to go as it was the only method to reliably eliminate this

    http://larvatusprodeo.net/archives/2013/07/bugger-the-utilities/#comment-428851

    It can still be done through legisaltion that levies the distributors from their proceeds with a no increase command. The distributors have collected their 40 or 50 billion for grid upgrades, so that portion of their increased income can now be directed to building the inland CSP plants, largescale geothermal, and offshore windfarms that we will need within the next 10 years to reduce emissions and balance the grid while securing the future of the grid. Ten years at 8 billion per year will provide an 80 billion injection of funds for guaranteed results rather than the “we’ll only do it if we can’t get away without doing it” approach that we are getting at present.

    Without this form of real leadership from government individuals will resolve their energy needs independently and the Australian grid will become unstable and uneconomic.

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