The coronavirus (COVID-19) pandemic has profoundly changed fundamental aspects of our daily lives. Many of us are working – and kids are studying – from home. At the same time, many services and businesses – for example, restaurants, shops, gyms, libraries - have had to close their doors, at least temporarily. So what is the cumulative impact of all these changes on electricity supply across the National Electricity Market (NEM)?
The supply and demand characteristics of the NEM are extremely dynamic. Unlike markets for other goods and services that operate and fluctuate on a longer-term basis, the supply and demand of electricity across the entire NEM must always balance instantaneously. If there is a break in electricity supply, this can lead to load-shedding or blackouts.
With people at home and already experiencing a lot of change and challenges as a result of the impacts from COVID-19, it is more important than ever that a secure and reliable supply of electricity is maintained.
Reliable supply of electricity
The good news is that there is sufficient available generation available in the NEM at the moment. Typically, infrastructure in the NEM (generators and network poles and wires) is designed to meet peak demand, which in Australia generally occurs on very hot weekdays in summer – because of the amount of air-conditioning which is added at these times to the usual heavy weekday load.
The chart below shows that not only is there enough capacity (ie generation) available in the NEM to meet peak demand, but demand recently (as shown by the orange bar for a seven-day period in April) has been much lower than the peak demand conditions that the NEM can handle.