Energy impacts: the rise of working from home.

Overall COVID-19 has had minimal impact on peak demand across the National Electricity Market (NEM). At the peak of lockdowns an estimated 4.3 million Australians (Roy Morgan, 2020) were working from home with many employers now shifting to hybrid work from home/work from office models.

This increase in working from home has seen electricity demand become distributed differently throughout the network with more demand coming from residential locations. AEMO reported that the increased residential demand has offset any demand reductions due to temporary decreases in business operation consumption.

The recent hard lockdowns in Victoria provide an example, using meter data, of how the distribution of energy demand shifts with a significant change in behaviour, how we work and where we spend our time.

Energy Networks Australia analysed these consumption changes in Victoria tracking increases and decreases during August, compared to the same time last year. Overall state demand stayed relatively stable, but what this data shows are the geographical areas that have seen big increases and decreases in demand for SMEs and total consumption.

(Source: Energy Networks Australia 2020)

Heading into summer, we have seen alarmist headlines warning of the potentially disastrous impacts of a more distributed workforce this summer creating a less reliable energy supply for the network, but this may not provide an accurate picture of the situation.

The data tells us that from an overall demand perspective, the network has enough generation capacity to meet peak demand. Where we could see an impact is at the localised level because of where the demand is distributed.

More people working from home means additional pressure on the localised networks compared to last year. This extra pressure in residential areas could see blackouts occur if the local system is overloaded, even when there is plenty of capacity available at the state-wide level. The effect would be similar to when a storm causes a temporary localised blackout when there is enough generation available, but the transmission lines are unable to deliver to the end-user.

The risk of this occurring is heightened during the evening peak which is likely to be around sunset when rooftop solar generation declines.

AEMO released the Electricity Statement of Opportunities (ESOO) in late August which forecasted electricity supply reliability in the NEM over the next ten years. The latest release incorporates the uncertain impacts of the COVID-19 pandemic and includes a short-term forecast reduction of peak demand and energy consumption over the summer scenarios. Ultimately, AEMO does not anticipate that working from home will affect the reliability of electricity supply this summer.

What the ESOO does forecast is rapid declines in daytime minimum operational demand levels in all NEM regions across the next ten years, as a result of continued strong uptake of rooftop solar installations. Declining minimum demand could lead to issues with managing voltage, system strength, and inertia with these systems services becoming more critical to maintaining a reliable system. AEMO are already managing some of these issues in South Australia with costs recouped through additional charges on retail bills.

To manage these risks the ESB are proposing a series of energy market reforms to value these essential services and incentivise investment in assets capable of providing them. Read more about this in our article on Post 2025 market design .

What we can take away from the last year is that it doesn’t matter where you are, work needs to be done and you need a reliable, sustainably priced electricity supply (among other things) to support you to do it.