The Australian Energy Market Operator (AEMO) expects little demand growth in the NEM, with average annual electricity demand forecast to grow by just 0.3 per cent per year for 20 years to 2033-34 in its medium scenario.237 Relatively slow growth in demand is also forecast to continue in the SWIS over the next 10 years, with the Independent Market Operator (IMO) expecting an average growth rate of 1.8 per cent over the period.238
The Audit projects the following capacity, demand and DEC for electricity services infrastructure in 2031:
■ national installed generation capacity is projected to reach 79 GW;
■ 333 TWh of electricity is projected to be generated (a 46 per cent rise from 2011);
■ 321 TWh of electricity is projected to be transmitted (a 48 per cent rise);
■ 262 TWh of electricity is projected to be distributed (a 43 per cent rise);
■ the highest growth in generation installed capacity between 2011 and 2031 is projected to occur in Queensland (56 per cent). Queensland is also projected to have the highest growth in transmission peak demand (59 per cent), while NSW (48 per cent) is projected to have the highest growth in distribution peak demand;
■ similar to capacity, the greatest proportional increases in utilisation for generation and transmission are projected to occur in Queensland (52 per cent and 67 per cent respectively);
■ DEC is set to rise to $26 billion for the electricity infrastructure services sector, an increase of 63 per cent from $16 billion in 2011; and
■ NSW has the highest projected increase in DEC ($8.2 billion) between 2011 and 2031.
Table 24 shows the projected proportional change in DEC by state/territory between 2011 and 2031.
It is worth noting the different views about future demand for electricity. AEMO forecasts239 minimal electricity consumption growth in the NEM.240 In contrast, consultants for the Audit project that the DEC of electricity infrastructure will continue to increase in those jurisdictions. There are several reasons for this variation. The Audit research assumes an energy efficiency improvement rate of 1.5 per cent per year (compared to an historic rate of 0.5-1.0 per cent), whereas AEMO assumes much faster rates, exceeding 20 per cent in some years. Consequently, electricity use forecasts underlying the Audit's DEC measure are considerably higher than AEMO's forecasts. Additionally, AEMO reports and forecasts unit electricity consumption in GWh, whereas DEC is a measure of the value-add provided by electricity infrastructure, expressed in dollar terms. The two are not necessarily perfectly correlated.
The top five audit regions in terms of growth in DEC between 2011 and 2031 are found in WA and Queensland. It is likely that this growth is mainly associated with spending on large industrial and mining projects.
Table 24: Projected proportional change in DEC by state/territory - 2011 to 2031
| State | DEC Generation | DEC Transmission | DEC Distribution | DEC Total |
| 55% | 56% | 55% | 55% | |
| 55% | 51% | 52% | 53% | |
| 50% | 81% | 52% | 57% | |
| 61% | 59% | 58% | 59% | |
| 108% | 133% | n/a | 121% | |
| 15% | 13% | 14% | 14% | |
| 41% | n/a | 45% | 44% | |
| n/a | 47% | 47% | 47% | |
| Australia | 64% | 83% | 52% | 63% |
Source: ACIL Allen Consulting (2014a)
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237. Australian Energy Market Operator (2014a)
238. Independent Market Operator (2014)
239. Australian Energy Market Operator (2014a)
240. It is not possible to forecast aggregate peak demand across the NEM on the same basis as total consumption. Peak demand is determined by a range of factors, including weather, timing and the range of an area affected by a weather event. These will not necessarily (and rarely do) coincide across the various jurisdictions.