AEMO has just doubled its forecast for EV uptake in Australia | RenewEconomy

AEMO has just doubled its forecast for EV uptake in Australia

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Market operator’s latest forecasts for the uptake of electric vehicles suggests 10 million EVs, or half the car fleet, in 20 years.

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The Australian Energy market Operator has effectively doubled its forecast uptake for electric vehicles in Australia, suggesting that within two decades they could account of more than half of Australia’s car fleet.

This graph above was included in a presentation made to a key working group just a few weeks ago, and highlights the difference between forecasts made at the time of its annual Electricity Statement of Opportunities last September, and its update last month.

The changes are reflected across all three scenarios – weak, neutral and strong – which I guess are based on the availability and cost of EV models, the price of oil, and the consumer shift to distributed energy – rooftop solar, battery storage, and EVs.

The most remarkable difference is in the “strong” scenario. Just six months ago, AEMO was predicting 15,000GWh of consumption from the grid from EVs. Now it is looking at nearly 30,000GWh.

That’s around 15 per cent of total demand on the Australia grid, and to extrapolate the significance of that number from previous predictions, it could mean that AEMO is expecting half the cars on the road in 2037 will be electric.

A report prepared by energy consultancy Energeia last September put the the AEMO’s neutral scenario at the  equivalent of 7,200GWh, which represented 2.56 million EVs, of 13.2 per cent vehicles. (See graph below).

This latest update of nearly 30,000GWh suggests that AEMO is now expecting 10 million EVs on the road by 2037 – an average of 500,000 a year between now and then. That would represent more than half the current small car fleet of 18.8 million vehicles.

This is fascinating – both for the implications for the transport sector, and for the electricity sector.

AEMO cares about the uptake of EVs because it represents what is known as the “last load” for the electricity market. In other words, it is about the only thing that will add to demand in the future, apart from population growth.

AEMO needs to understand the uptake both to ensure it has enough supply to meet that demand, to ensure that not all EVs are trying to charge at the same time, and to explore opportunities to use the EV batteries as a service to the grid, to help meet peak demand rather than worsening it.

A week ago Morgan Stanley analysts released a report that suggested if every Australian internal combustion engine (ICE) vehicle to electric, the incremental load would be in the order of 50TWh (50,000Gwh), or 26 per cent of current total demand.

Morgan Stanley noted that the AEMO had previously settled on a “last load” forecast for 2025 of around 2TWh, based on a four per cent take up rate of EVs.

The Morgan Stanley analysts noted that even if 50 per cent of new vehicles sales were EVs (Australia’s new car market is about 1.2 million a year), it would take 30 years for the current fleet of 18.8 million vehicles to convert to EVs.

Now, it seems, AEMO appears to be embracing that sort of scenario, which makes sense, because once the cost of EVs matches that of petrol cars, it will be difficult to think of a rational reason not to go electric.

Indeed, at last week’s Smart Energy Conference, the Beyond Zero Emissions Group was repeating its forecast that the sector could go 100 per cent EVs by 2030, once that transition point on purchasing price had been passed.

And that could happen within a few years, although Australian consumers still suffer from a lack of options – the Tesla Model 3 will not be available for at least another year, the new Nissan Leaf model may not be here until 2019, and only Hyundai’s Ioniqu and Kona may appear this year.

At low levels of uptake, however, there will be little difference to demand on the grid.

Christopher Munnings, from the CSIRO, told the same session at the conference that one million EVs over five years – or about 20 per cent of the new car market – would lift electricity demand by around 1.3 per cent.



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  1. Roger Franklin 2 years ago

    Interesting to see the doubling the AEMO 30 year forecast of EV takeup without factoring in the impact of Self-Driving EV’s and the likely reduction in personal car ownership.

    Given that some international analysts are predicting personal car ownership will drop over the next 30 years and that EV’s will become effectively mobile batteries, I wonder what the overall net impact will be?

    • Rod 2 years ago

      Agreed. I for one hope this prediction doesn’t come true.
      Watching Tony Seba’s Third Industrial Revolution, he asked the mostly young audience “you don’t want to own cars do you?” and most of the audience shook their head.
      We need smarter ways of moving people than a single occupant vehicle, regardless of the source of energy.

      • Ian 2 years ago

        That is seriously funny : Seba a man, of great presence , commanding his audience’s adoration and asking a direct question will quite obviously get the affirmative answer . However, Seba is on the right track about the future of transport.

        The ways to reduce car numbers are to make other options more affordable or more convenient or to make private cars less affordable or less convenient or to make people think that cars are the less desirable travel option or that travel is not at all desirable.

        Commuter cities are being set in stone with every new greenfield suburb built and this concrete pollution is wrecking the best of our landscape . The idea of EV is a bit like the ideas of CCS or permanent nuclear waste repositories, perpetuating a bad situation or technology. These vehicles or their driverless cousins are not going to save the live-drive-work model anytime soon. Just as there are now a multitude of travel options there should be a multitude of cityscapes which better suit the needs of people throughout the different stages of life. Reduce the need to travel and you will reduce the number of car journeys.

      • Rod 2 years ago
    • Hettie 2 years ago

      Don’t forget our high immigration rate. Population growth will drive an increase in total vehicle numbers, and many of those immigrants are from Europe, where acceptance of EVs is far higher than here. They won’t be buying ICE cars, will they now!

  2. manicdee 2 years ago

    AEMO might also be optimistic about the adoption of electric semi-trailers and other heavy transport like busses and coaches.

    • Gyrogordini 2 years ago

      Yes, a couple of the comments seem to imply that we’re only looking at decarbonising cars. The EV revolution will affect ALL transport, as well as appliances and machinery.
      Trucks and buses are already available, and the first diggers are being announced.
      Bring it on – we’ll find the energy when required.

  3. Joe 2 years ago

    This is terrible news for our EV Champion….the Kelly. He must have had a stroke upon getting his information. When will tariffs be placed on EV’s I wonder.

      • Joe 2 years ago

        Crikey, its all happening EV style! Better send an Ambo around to the Kelly quick smart…stroke, cardiac arrest…the man must be close to terminal.

        • Joe 2 years ago

          and make it an EV Ambo at that

          • Ren Stimpy 2 years ago

            With a solar charged defibrillator.

          • Charles 2 years ago

            But if Kelly’s on board… oh dear, hope it’s not raining..

        • Hettie 2 years ago

          Don’t rush.

    • Peter Campbell 2 years ago

      Kelly will probably demand that EV owners pay a sort of ‘carbon tax’ to compensate for the shortfall of carbon delivered into the atmosphere.

      • Farmer Dave 2 years ago

        Shhh! Don’t put ideas in his head! Although, I doubt he is a regular reader here….

        • Ren Stimpy 2 years ago

          I doubt he is a regular reader. Full stop.

          • Hettie 2 years ago


          • Ren Stimpy 2 years ago

            The poor fellow can only count to 10.

            Or 20 at best if he takes his shoes off.

      • Rod 2 years ago

        Well, they have already floated replacing the fuel tax with a road usage charge. We can’t have the 0.001% of EVs on our roads getting an unfair advantage over ICE vehicles.

    • MaxG 2 years ago

      Maybe transfer the fuel excise to the kWh sucked from the grid :))

  4. Tim Forcey 2 years ago

    EVs are… “about the only thing that will add to demand in the future, apart from population growth”. Uh, getting homes and some industry off the gas grid would also add to electricity demand. There is not a blind spot to this trend at Renew Economy is there? It is very much about heat pumps of course. See:

    • Tim Forcey 2 years ago

      At Melbourne Uni (see Section IX of the linked “Electricity Journal” paper), we summarised things that would increase electricity demand:

    • Tim Forcey 2 years ago

      More on getting homes off gas (and therefore potentially increasing electricity demand) here:

    • Tim Forcey 2 years ago

      What AEMO (and other stakeholders) will have to get across in addition to EVs is mid-winter electricity supply. With more use of heat pumps for home heating, and the drop off of solar PV production in winter (of course), peak electricity demand in some places may shift from mid summer to mid winter. Well, apparently Canberra and parts of NSW already experience peak electricity demand mid winter.

      • Rod 2 years ago

        In a truly smart grid, assuming V2G, the grid would take from the EVs during the peak and top up in the wee hours.
        With FiTs now dropping in some States, pre-warming the house makes sense.

      • Hettie 2 years ago

        Indeed. All Highland areas, even well into Qld. And this little black duck is ditching gas heating for RCAC May 4.
        It may knock holes in my fit credits, but I’ll lose most of the gas bill. Payback time? Dunno.
        Depends on data I don’t yet have, but I would estimate saving $600 pa on gas, capital cost including new power circuit $2,700, loss of fit not yet known, extra power cost also unknown. Time will tell.

  5. riley222 2 years ago

    I’m hoping not to hear ‘this is why we need new coal fired plants’, but I’d bet a dolla we will.

    • Nick Kemp 2 years ago

      Or a cold fusion reactor, or something else that won’t even be built before they realize they didn’t need it

  6. DrJake 2 years ago

    Just a small point to pick up on. There were 18.8M registered vehicles in Australia as of Jan 2017, but these are not all small cars as stated in the article. According to ABS, 75% of these vehicles are passenger vehicles i.e. 14M; so that will change the numbers in the analysis above slightly. Encouraging to see AEMO finally starting to revise these estimates.[email protected]/mf/9309.0

  7. Les Johnston 2 years ago

    The car fleet EV analysis would be significantly altered once those EVs are given the opportunity to become peak demand energy generators. Provided that prices are set based upon the marginal cost of producing that peak demand electricity from “other” sources, eg gas generators, then EVs are in a price position to flatten the peak and electricity costs would be reduced!

  8. Solar 4 me 2 years ago

    Probably off by 10 years, by 2037 it’ll be more like 90%

  9. Hettie 2 years ago

    Once governments realise the fuel and maintenance savings of EVS, and all gov’t vehicles are electric, the charging points will pop up like toadstools, and range anxiety will diminish. The pattern is clear. A dribble, a trickle, a stream, and suddenly a flood of EVs on the roads.
    Bring it on.

  10. neroden 2 years ago

    OK, so, here’s the WORLD forecast.

    80 million cars sold per year. (And people would rather not own cars if they can avoid it, so this isn’t going to increase.)

    1.2 million EVs sold worldwide in 2017, doubling every two years. Extrapolate: in SEVEN years every new car will be an EV. OK, so the curve should slow down a bit… but they’ll hit 50% in FIVE years, so it’s safe to say that in TEN years every new car will be an EV.

    That’s 2028.

    At this rate it seems very likely that nearly all those cars will be manufactured in China by Chinese companies. Tesla and Renault are the only companies outside China which seem to have a headstart, although I suppose VW and Hyundai *might* catch up. BYD, Geely, BAIC are going to be big.

    Anyway, with all new cars being electric in 2028, and with cars lasting about 12 years on the road, half the fleet will be electric well before 2035. AEMO’s projection for EV adoption is *substantially too low*.

    • Nick Kemp 2 years ago

      In Australia we will stick with coal powered steam engines thank you very much

  11. Ray Miller 2 years ago

    Opportunity knocking? AEMO should not only be doubling down on the
    forecasts but also working out the opportunities of having millions of
    potentially controllable bidirectional mobile storage plants.
    now gives the opportunity of installing “smart” (I hate using the word)
    metering to give the mobile battery system interaction with the grid in a
    harmonious and mutually beneficial way. Now is the time to work out
    the standard/s including adding in the behind the meter energy use for
    the transport service even if it is not billed for.

    AEMO will need
    all the totals (from the early stages of the transition) and avoid the stuff up which occurred with the PV
    metering by the so called energy experts who only proved their

    With the Australian liquid fuel reserves only sitting at around 20 days we need to transition to an EV transport system in the interests of national security and emission reduction quickly and AEMO needs to be prepared for this!

    • Hettie 2 years ago

      Tony Seba has given multiple examples, dating back to the Guttenberg Bible, of the pattern of growth when a new technology is disruptive.
      As soon as a new technology becomes clearly better than what has gone before, it’s growth starts to double exponentially.
      This year, 100 units
      Next year, 200
      400, 800, 1600, 3200, 6400.

      100 to 6,400 in just 6 years
      Or take it in percentages of a market, and have that double every two years.

      EVs were 1.5% of the global market in 2017. In the US, they have now reached price parity with ICE vehicles, but running costs are less than one tenth.That’s the tipping point. A 10 X advantage.

      1.5% 3.0. 6 12 24 48 96%
      6 doublings. 12 years.
      That gives near enough to 100% new vehicles EV by 2030.

      And as most cars are replaced in less than 10 years, that means the car that is brand new today will be replaced by an EV by 2028. Older ones will be replaced sooner.

      Unless I have it very wrong, that means that by 2030 ALL cars will be EV.

      Remember Kodak?

      The oil companies better start realising that they are not in the petrochemical market. They are in the heating and transport fuel markets. Both are about to be taken over by electricity, which itself is well on the way to being overtaken by renewables. Already at 12%, , so only 3 more doublings to total saturation. Say 6 years.

      Remember Kodak, you oil companies. 6 years to establish your presence in renewables. 6 years to ensure that every petrol station becomes a multi- outlet charging station, with good quality cafe attached to cater for the customers while they wait.

      6 years to ensure that every open air shopping centre carpal is covered in solar panels, with a charging station for every 4 cars.

      Very little time to see EVs and renewables not as a threat, but an opportunity.
      Little time to get into heat pump technology in a very big way.
      Forget about pipelines, oils and, shale, deep sea exploration. There are far better places for that money.

      Or your very own Kodak moment WILL be upon you.

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