Power Use Down Since Carbon Tax

by Peter Hannam, Carbon economy editor, Brisbane Times: http://www.brisbanetimes.com.au/business/carbon-economy/power-use-down-since-carbon-tax-20130708-2pmcz.html

The carbon tax and a continued slump in electricity demand have cut carbon dioxide emissions of eastern Australia's power sector by 12.2 million tonnes in the past year, new research shows.

The carbon emission index produced by consultants Pitt & Sherry shows emissions from national electricity generators serving the ACT, NSW, Tasmania, Victoria and parts of Queensland and South Australia, fell 6.9 per cent for the year.

The drop outpaced a 2.2 per cent slide in overall power demand.

The carbon tax, which rose from $23 a tonne to $24.15 on July 1, had its biggest impact in promoting hydro power, which grabbed the most market share from coal-fired power producers.

Adjusting for power consumed by the coal-fired plants, their share of total supply to the market dropped from 75.1 per cent in the year to June 30, 2012 to 72.5 per cent last financial year.

''That's the lowest for coal for many, many decades,'' said Hugh Saddler, principal consultant at Pitt & Sherry.

While hydro's share jumped to 9.6 per cent from 7.6 per cent, supply from wind farms rose to 5.6 per cent from 5.5 per cent. Gas also gained, rising to a share of 12.2 per cent from 11.8 per cent in the previous year, Pitt & Sherry said.

Determining the contribution of the carbon tax to cutting emissions and curbing electricity use is difficult, not least because other factors are involved, Dr Saddler said.

These include energy efficiency programs and rapid spread of solar photovoltaic panels, while the closure of the Kurri Kurri aluminium smelter, in NSW, and other manufacturing cutbacks also sapped demand.

And the fraught political debate about carbon price has probably made people think more about power use. ''People are becoming aware that it's quite easy to reduce their consumption to some extent,'' Dr Saddler said.