AEMO: Smart consumers vital to a low carbon grid

Renewable energy and smart consumers will play a critical role in the country’s future energy grid, according to the Australian Energy Market Operator (AEMO).

In its electricity forecast for the next two decades, AEMO predicted uptake in distributed solar generation and use of energy efficient appliances would keep grid-supplied electricity consumption stable for the next 20 years despite a projected 30 per cent increase in population and assumed average growth in the Australian economy.

AEMO chief executive officer Audrey Zibelman said consumers are becoming more educated about how much energy they are using.

“Advances in technology and economies of scale in production of solar rooftop panels, battery storage and energy efficient appliances are also providing consumers greater and easier opportunities to better manage their energy use and energy costs,” she said.

“For example, we have already seen a significant drop in the cost of solar rooftop PV over recent years which has corresponded with increased uptake.

“We believe this uptake will remain strong through to the late 2020s before leveling off.

“Likewise, battery storage will become far more prevalent with the uptake of solar PV while energy efficient appliances will become a more normal part of people’s way of life, especially when they are updating their appliances or even buying a newly built home which will be required to meet higher energy efficiency standards.”

Ms Zibelman said the energy sector’s transition to a low carbon future would provide important opportunities and challenges for consumers and the energy industry alike.

“The energy industry may leverage opportunities to assist consumers in managing costs through more targeted products and services,” she said.

However, the energy sector is likely to require investment in generation, network, and/or demand-side solutions to ensure reliability and security of supply as a result of the forecast maximum demand growth and changing generation mix.

The Electricity Forecasting Insights also projects the increased use of solar photovoltaic (PV) panels will shift maximum demand on the grid to later in the day, to a time when there is little or no rooftop PV generation available.

“By summer 2036-37, the New South Wales maximum demand is forecast to be 15,276MW, while in Queensland it is forecast to be 10,021MW, 9758MW in Victoria and 3112MW in South Australia,” Ms Zibelman said.

Over the longer term, AEMO expects the transition towards “more actively engaged and flexible consumer demand” to accelerate with the predicted uptake in solar PV to result in approximately 20,000MW of installed rooftop PV by 2037.

Residential and commercial battery storage uptake is expected to exceed 5500MW by 2037 (an increase of 2000 W over last year’s 20-year forecast) with a proportion of new storage to be aggregated and used for price hedging by retailers and the provision of ancillary services.

The report also forecasts electric vehicle (EV) uptake to remain low initially, but increase around 2020 adding demand flexibility but having a limited impact on annual consumption overall.