Electricity demand drops as solar surges

AEMO’s latest quarterly report has revealed that rooftop solar has helped to drive demand for electricity from the grid to its lowest level in 16 years.

By: ARENA

In the new report, AEMO says the average level of demand across the NEM dropped to the lowest level since 2002 in the fourth quarter of 2018, and that South Australia set a new all-time minimum demand record on October 21.

It attributes the drop in demand to the growing uptake of rooftop solar, as well as improvements to efficiency and a decline in energy intensive industries.

The lower demand did not translate to lower wholesale electricity prices, which reached record levels during the quarter in all regions except Tasmania.

AEMO say a range of factors can be blamed for the high prices, including the closure of 4,000 MW of coal power generation in recent years, unplanned outages at Victorian brown coal power stations during the quarter, and high gas prices.

In a sign of the challenges the market has ahead as more solar and behind the meter assets come online, Queensland also set a new record for peak demand on February 14.

ARENA is supporting work that integrates consumer-owned small scale assets – known as distributed energy resources -into the electricity network, recently announcing nearly $10 million in funding for 12 new projects and studies.

There are already more than two million rooftop solar installations nationwide, up from just 14,000 a decade ago.

According to Green Energy Markets December Renewable Energy Index, these rooftop solar systems provided for more than six per cent of Australia’s electricity during December. As a share of the total generation mix, rooftop solar is rapidly catching up to hydropower.

By 2050, this is expected to increase to up to 45 per cent of all generation, according to forecasts by AEMO and CSIRO.

In late 2018 ARENA CEO Darren Miller launched the Distributed Energy Integration Program – a collaboration between energy sector peak bodies and industry and consumer associations.

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ARENA