Australia's electricity landscape could change significantly in the future and consumers will be deciding just what that future will look like.
A new report from the Future Grid Forum, Change and choice: The Future Grid Forum’s analysis of Australia’s potential electricity pathways to 2050, looks at a range of opportunities and presents four scenarios, not predictions, through which we can view potential futures for our national electricity system.
CSIRO Energy Flagship Chief Economist, Paul Graham, said recent declining demand, higher electricity prices and strong adoption of roof-top solar panels have changed the industry’s view of what is plausible in the future and trained a focus on affordability challenges.
"All of the choices in the Future Grid Forum scenarios have consequences for the price of electricity, something that has significantly impacted consumers in recent years," Mr Graham said.
"Electricity will not get cheaper in the coming decades, but bills can be reduced through the adoption of energy efficiency, peak demand management and on-site generation.
"These steps, in combination with general wages growth, means the share of income average households spend on electricity is projected to be similar - shifting marginally from 2.5 per cent in 2013 to between 2.3 and 2.9 per cent in 2050 depending on the scenario.”
Electricity has traditionally been a service with which consumers have not proactively engaged, but the Forum’s scenarios present a number of ways for people to take greater control of how they consume and produce electricity.
"This proactive shift could potentially influence the business model for the electricity sector, encouraging the emergence of new services to supply an individually tailored product – not dissimilar to the telecommunications industry shift from a one-size-fits-all landline telephone system to a wide variety of mobile and associated data and entertainment services," Mr Graham said.
"One of the Forum's scenarios looks at the option for around a third of consumers to disconnect from the electricity grid through the use of on-site generation using technologies like rooftop solar panels and battery storage; and this is projected to be economically viable from around 2030 to 2040.
"Under the full range of scenarios Australia could see on-site generation grow from the current figure of 8 per cent to reach between 18 and 45 per cent of total generation by 2050, but mostly while staying connected and using the grid as an electricity trading platform."
The Forum also projected that technology will allow more sophisticated ways of managing household demand during peak times through the introduction of devices such as smart air conditioners and in-home storage systems.
"Better strategies for peak demand management could save two cents per kilowatt hour or $1.4 billion per annum on distribution costs for households," Mr Graham said.
The Forum findings are a starting point from which all stakeholders can begin to understand, manage and benefit from changes to the electricity system.
"This is an extraordinary time of change for Australia's electricity industry and the Forum partners see the release of this report as an opportunity to begin a national conversation to decide the right answers for the sector, its stakeholders and, most importantly, all Australians," Mr Graham said.
The Future Grid Forum report, Change and choice: The Future Grid Forum's analysis of Australia’s potential electricity pathways to 2050, and the supporting technical modelling and social dimensions reports can be downloaded at Future Grid Forum: change and choice for Australia’s electricity system.
The launch event panel discussion will be streamed live online at Future Grid Forum webcast , Friday 6 December 2013 9:30am AEDT. A panel discussion will be hosted by ABC journalist, Tony Jones. Questions for the panel can be submitted via the online tool.
Follow the conversation on Twitter at @CSIROevents or use #talkingenergy.
Future Grid Forum
CSIRO convened the Future Grid Forum to develop and explore potential scenarios for Australia’s energy future and support the decision making process around what comes next.
The Forum brought together more than 120 representatives from the electricity industry, government and community to inform and inspire a national conversation about the future of electricity in Australia and provide a way forward for the sector, its stakeholders and, most importantly, all Australians.
Panel of spokespeople
Paul Graham, Chief Economist, CSIRO Energy Flagship
CSIRO’s Energy Flagship is delivering the energy solutions to secure Australia’s environmental, economic and social wellbeing.
Paul is the Future Grid Forum’s project leader and has previously led four other sector-wide initiatives that brought together a diverse group of Australia’s leading energy and transport stakeholders to identify plausible scenarios and their implications for the nation’s energy future.
He has developed a number of economic models designed to examine the likely technological development paths in Australia’s electricity generation and transport industries.
Dr Cassandra Goldie, CEO, Australian Council of Social Service
The Australian Council of Social Service is the peak body for the community sector in Australia, and the national voice for people experiencing poverty and inequality. Cassandra is a leading advocate on economic and social policy, a regular media and public commentator, and a highly respected human rights lawyer.
Matt McKenzie, Regional Leader Asia Pacific, GE Digital Energy
GE’s Digital Energy business provides integrated smart grid solutions and reliable power delivery to electric utilities as well as supporting the gas, water and telecom sectors. As a global provider of innovative technology for a 21st century electric grid, Digital Energy’s portfolio of products and solutions enable efficient and reliable energy delivery, productive utility operations, and informed and empowered consumers.
Anna Skarbek, Executive Director, ClimateWorks Australia
ClimateWorks Australia is an independent, research-based, non-profit organisation committed to catalysing reductions in greenhouse gas emissions in Australia.
Anna has previously worked in London’s carbon markets, as a senior policy adviser for the Victorian Deputy Premier, investment banker in Macquarie Bank’s energy and utilities team, and solicitor with the national corporate law firm Mallesons Stephen Jaques. Anna also served on the board of Amnesty International Australia from 2000-2006 in roles including National Treasurer and Victorian President, and was a director of the Big Issue Australia including founding committee member for the Homeless Soccer World Cup in Melbourne.
John Bradley, Chief Executive - Energy Networks Association
The Energy Networks Association represents Australia’s electricity transmission and distribution and gas distribution sector. With more than $75 billion in assets and 13 million customer connections across the National Electricity Market, Australia’s energy networks provide the final step in the safe and reliable delivery of gas and electricity to households, businesses and industries.
Charles Popple, Executive Advisor Industry Development - SP AusNet (representing Grid Australia)
Grid Australia represents the owners of Australia’s electricity transmission networks in the National Electricity Market, plus Western Australia. Charles has extensive electricity industry experience, particularly in strategy and technical planning, related to networks and electricity market development and reform.
Phil Craig, Executive General Manager Corporate Affairs, Origin Energy
Phil Craig joined Origin in May 2001 and was appointed Executive General Manager Corporate Affairs in March 2012. In this role, Phil has responsibility for Origin’s brand and reputation, government and media relations, policy development and sustainability, and the Origin Foundation.
Prior to this, Phil was General Manager of Origin’s Retail business, leading the development and substantial growth of that business over a decade.
Phil has a Bachelor of Commerce from the University of Melbourne, and a Master of Business Administration with Distinction from Warwick Business School (UK).
Linley Davis, CSIRO Energy Flagship
T: 02 4960 6116
M: 0417 772 480
Emma Watts, Energy Networks Association
T: 02 6272 1514
M: 0402 459 565
Frank Coletta, Grid Australia
T: 02 9284 3371
M: 0468 987 295
Anneliis Allen, Origin Energy
T: 02 8345 5119
M: 0428 967 166
Meg Argyriou, ClimateWorks Australia
T: 03 9902 0744
M: 0429 185634
Katie Lennon, GE
T: 02 9324 7095
M: 0406 316 907
Fernando de Freitas, Australian Council of Social Service
M: 0419 626 155