Power down: why is electricity consumption decreasing?

Introduction: Until 2010 – for well over a century, through two world wars and the Great Depression – the quantity of electricity used in Australia each year was greater than the year before. In the three years since 2010, the quantity used each year has been less than the year before, and there is no evidence of a reversal in this trend in the coming months. The electricity consumption decrease has been relatively large in the National Electricity Market (NEM), which covers the five eastern states and the ACT, but is also occurring in WA. Specifically, NEM demand in the financial year to 2013 was almost eight terawatt hours (TWh), or 4.3 per cent lower than in the peak year of 2009. Why is this important? If electricity consumption in the NEM had continued to grow from 2005 onward at the same rate as it had for the previous twenty years, consumption would have been about 37 TWh higher in 2013 than it actually was. This difference is equal to the output of almost 5,000 megawatts (MW) of coal fired generation capacity, which is just less than the combined capacity of Bayswater plus Eraring in NSW or, in Victoria, Loy Yang A plus Loy Yang B plus Hazelwood. All of the decline in consumption has in fact been at the expense of coal-fired generators, with the result that many are now barely profitable. Greenhouse gas emissions fell by 9.2 Mt CO2-e, roughly two per cent of Australia’s total emissions, in 2012 alone