Electricity demand and emissions continue to grow

  • Demand: Increases continue to follow a 13 month national trend to an annual demand in the NEM at 2.5 per cent higher than the low point recorded to February 2015.
  • Emissions: Total emissions from electricity generation in the NEM increased again in the year to March 2016. Annual emissions were 5.5 per cent higher than in the year to June 2014 driven in large part by black coal generation in Queensland to meet the rapid demand growth in that state.
  • Generation: Total coal generation was 76.1 per cent, compared with a minimum of 72.3 per cent in the year to July 2014.

 

Electricity generation, demand and consumption continues to be on the increase nationally following a 17 month trend.

The April 2016 Carbon Emissions Index (CEDEX) Report by pitt&sherry and The Australia Institute (TAI) indicates the total annual demand in the NEM is now 2.5 per cent higher than the low point recorded for the year ending February 2015.

This rate of demand growth was considered normal for the electricity industry up until 2004, but has not been seen since that time.

As a consequence, emissions from electricity generation have increased once more to an annual level of 5.5 per cent higher than in the year to June 2014. The emissions increase continues to be driven by growing black coal generation in Queensland, to supply the rapidly growing demand in that state, and more modest increases in New South Wales to make up for steadily falling imports of Queensland black coal electricity.

Renewable energy generation continues to increase, now at 13.2 per cnet to March 2016, its highest level in decades (excluding the carbon price era). A third solar farm at Moree on line from late February is now contributing to the overall renewables along with hydro and wind. The three large solar farms, all in NSW, contributed 0.7 per cent of NSW generation and 0.2 per cent of total NEM generation in the month of March.

Electricity use in the Queensland coal seam gasfields continues to be the main driver of demand growth in the NEM.  Additional annual demand to power production in the Queensland coal seam gas fields reached about 4 TWh, a 9 per cent increase in total state demand from the level of November 2014, when the shift to electric motor drive in the gasfields began. Abnormally high average summer temperatures across the mainland states, extending into the first two weeks of March, will also have contributed to demand growth. Upticks in consumption for NSW, Victoria and South Australia were in alignment with high temperature days.