The small increase by the household sector between 2010–11 and 2013–14 was driven mainly by increases in the use of diesel and natural gas. Net electricity use by households decreased by 6 per cent during the same period.
The main energy sources for household use were petrol (44 per cent), electricity (19 per cent) and natural gas (15 per cent). Petrol consumption by households decreased slightly (just under 2 per cent) between 2010–11 and 2013–14, during which time diesel use increased by 35 per cent. Between 2010–11 and 2013–14, household use of natural gas increased by 7 per cent, whereas household use of electricity continued to decrease (by 6 per cent, down to 203 petajoules in 2013–14) (ABS 2016b).
This significant progress in reducing electricity consumption is associated with a decline in electricity emissions—per person and total—during recent years. This decline is because of (Infrastructure Australia 2016):
- falling demand for electricity, largely caused by improved energy efficiency of appliances and machinery
- uptake of household solar panels, driven by reduced costs and taxpayer subsidies
- reduced consumption in response to a sharp increase in electricity prices in recent years.
Total renewable energy extracted by households increased by 46 per cent between 2010–11 and 2013–14, from 33.6 gigajoules to 49.2 gigajoules, and total renewable energy supply as a proportion of total domestic net energy use increased from 7.6 per cent to 8.4 per cent during this period (ABS 2016b). (For more discussion on energy efficiency and the built environment, see Energy efficiency.)
Total household energy costs were $47 billion in 2013–14, a 19 per cent increase since 2010–11. Expenditure on petroleum products was 53 per cent of this total, electricity costs were just over one-third (34 per cent), and natural gas was 13 per cent. Expenditure on each of these energy products has increased at a much faster rate than consumption of these energy sources by households in recent years (ABS 2016b; Figure BLT8).
There are 3 major components of a typical energy bill: wholesale costs (covering electricity being generated or gas being extracted), network charges (paying for the reliable delivery of energy via powerlines or gas pipelines) and a retail margin (paying for meter reading and other services). Energy bills can also include components for Australian, and state and territory government–based environmental programs, such as those aimed at increasing renewable electricity generation. The share of each component can vary significantly across jurisdictions and for different types of customers. However, the cost of transporting energy and wholesale costs typically account for around three-quarters of the final energy bill.
In recent years, much of the increase in prices has been attributed to the need to invest in the network component because of previous underinvestment in maintaining the network or to increase capacity. The impact of policies to address environmental issues accounts for a small percentage of the increase (EEMG 2014, Green & Newman 2016, Swoboda 2013).