With apologies to Orwell, all electrification and energy efficiency strategies may be equal, but some are more equal than others. This is the central finding of a research paper we published earlier this week with influential public policy think tank the Australia Institute, titled Buildings as batteries: How buildings can support the clean energy transition.

What is the problem with electrification and energy efficiency?

In short: nothing. But with electricity networks becoming dominated by Variable Renewable Energy (VRE) generation from sources such as wind and solar (we wish!), saving energy at times when it is abundant makes little sense, while at other times it is more essential than ever. We need more renewable energy generation, not less, so we need to value it and use it wisely.

As the following plot from the University of New South Wales’ Collaboration on Energy & Environmental Markets (CEEM) shows, it is now common for a significant amount of renewable electricity generation capacity to be ‘curtailed’, that is switched off, and wasted because there is insufficient network demand to take it up.

Figure 1. Curtailment of solar energy generation in Victoria, with generation supplied to the Australian National Electricity Market (NEM) in yellow and curtailment in brown

Likewise, electricity networks are becoming constrained at peak times—typically on weekday mornings and evenings when commercial, industrial and residential loads coincide—and the situation will become even more challenging as gas-powered heating, cooking and industrial processes are ‘electrified’. The last thing any community should want to see is an overinvestment in transmission lines carving up farms and national parks and the construction of gas “peaking” plants to meet demand that doesn’t need to exist.

Why are buildings so important to the clean energy transition?

Approximately 50% of Australia’s electricity is consumed in buildings, and at peak times buildings account for about 77% of network demand. Proportions are similar in other developed nations. Furthermore, buildings are the gateway to so-called “behind the meter” Distributed Energy Resources (DER), including stationary batteries, thermal storage technologies, electric vehicles, and other controllable loads.

Our analysis demonstrates that much of the built environment’s electricity demand, particularly in commercial office and retail buildings, can be shifted – easily and cheaply. Our findings were consistent across all buildings analysed in all locations: demand from buildings can be doubled during times of abundant clean energy and halved at times when networks are constrained, and renewable energy is scarce.

Figure 2. Electricity demand with load flexibility for a commercial office building in Sydney during Spring / Autumn

Our research shows that the opportunities buildings present for reducing greenhouse emissions, improving grid stability, and minimising the cost of the clean energy transition are profound and growing.

So, given the financial, emissions and grid stabilising potential of smart, grid-interactive buildings, why aren’t there lots of them? Why are governments intent on spending hundreds of billions of dollars to solve problems that buildings can address far more quickly, reliably and cost-effectively? As Ross Gittins, economics editor at the Sydney Morning Herald put it: “sometimes we don’t see what’s there to be seen because we don’t expect to see anything.”

Access the full report on the Australia Institute’s website here.

Access editorial coverage in the Sydney Morning Herald here.

Access reporting from Renew Economy here.