There has been a lot of talk over the past weeks about different energy sources, but it can be challenging to understand how household bills will be impacted.
A new report* released by the CSIRO, however, shows that significant savings are available to customers who adopt an all-electric lifestyle in this decade.
In fact, switching to electric vehicles and appliances, combined with improved energy efficiency measures, could save an average household as much as $2250 per year.
CSIRO Chief Energy Economist Paul Graham said that one of the key findings from the research is that energy transition will provide ongoing shared system benefits to all customers.
“System benefits are quite complex to explain, but essentially the more electricity people use, the cheaper it becomes for everyone,” Graham said.
“If demand increases outside peak times, that means there’s no requirement for new infrastructure. Instead, it just makes better use of existing assets, and the cost per unit drops.”
The analysis found significant individual savings for households who adopt an all-electric lifestyle this decade. In contrast, the modelling shows consumers who continue to use fossil-fuel powered cars and appliances will see no long-term improvement in their energy costs.
While individual household circumstances vary, the report reveals three key areas of opportunity: electric vehicles, energy efficiency measures, and electrification of household appliances.
Adopting the efficiency measures provides the average household with $500 in savings per year. Solar-battery ownership and switching to electric vehicle ownership can each provide $1400 to $1500 savings per year. In the case of both solar photovoltaics (PV) and electric vehicles (EV), the high upfront costs are offset by longer-term savings.
Graham said it’s important to take a long-term view. For example, an average household today might save just $200 per year by switching to all electric appliances and an electric car. But by the end of the decade those annual savings will have reached $2250.
“We know a lot of the available opportunities rely on individual circumstances. If you’re renting your property, you might have less control over making some of those changes,” Graham said.
“And we’re not advocating for consumers to immediately rush out and replace everything they own. It’s more to do with natural retirement over the coming decade of items like cars, kitchens, and hot water systems. As those opportunities come up, it may save you in the long term to look at an electric option”, he concluded.
* The research was commissioned by Energy Consumers Australia (ECA) to inform its Stepping Up report (PDF, 6MB), which presents a range of policy recommendations to ensure that consumers benefit from the energy transition. CSIRO’s researchers worked alongside consultancy firm Dynamic Analysis to project future outcomes for household energy bills based on the electrification of buildings and vehicles.
