Flat electricity demand puts price rises squarely on network charges: The Audit – Electricity Update

by Hugh Saddler

The Australia Institute has released the Electricity Update of the National Energy Emissions Audit (The Audit*) for August 2017.

The report, by renowned energy analyst Dr Hugh Saddler, shows flat demand across the National Energy Market (NEM).

“Total annual demand for electricity in the NEM is dead flat. With both national economic activity and population continuing to grow, electricity consumers are continuing to respond to ever rising prices by using electricity more efficiently, as they have been doing for most of the past seven years,” Dr Saddler said.

“This year consumers have seen a very sharp rise in electricity price due to generation costs.  However, for the last six years price rises seen by consumers were almost entirely caused by network ‘gold-plating’.

“This report shows that electricity consumers are continuing to pay for the policy failures of the last decade in the regulation of monopoly network businesses.

“The reduction in brown coal production in the NEM is being met by increased black coal as well as increased renewable production – notably wind power, which bounced back to record another all-time production record in July.”

Wind record

“The retirement of decrepit brown coal plants in Victoria had the potential to limit supply and cause price rises, but South Australian wind has come to the rescue keeping the lights on and putting downward pressure on wholesale prices,” Dr. Saddler said

*About The Audit and Electricity Update

In June 2017 The Australia Institute has launched the National Energy Emissions Audit (The Audit), written by respected energy analyst and ANU Honorary Associate Professor, Dr Hugh Saddler, which tracks Australia’s emissions of greenhouse gases from the combustion of fossil fuels. The National Energy Emissions Audit will be published on a quarterly basis, in September, December, March and June each year. In each intermediate month the NEEA Electricity Update will report on changes to emissions from electricity generation in the National Electricity Market (NEM).

Full report