Homes and businesses are in hot water over cost-of-living pressures, but rapid electrification could save them billions of dollars, economic modelling shows.
Although rooftop solar on Australian homes produces more electricity than any one of the nation's coal-fired power stations, households continue to pay sky-high power bills.
But smarter use of hot water, which typically contributes around one third and sometimes up to half of a power bill, could lighten the load, according to research released on Wednesday.
"Households are paying more than is optimum for their hot water, and all consumers are paying more for electricity than necessary," energy and sustainability strategist Gabrielle Kuiper said.
Inconsistent subsidies and a lack of standards mean governments and the national electricity market fail to support the required "big shift" in consumer behaviour, Dr Kuiper said.
Abundant renewable energy is being wasted during the daytime yet the 4pm-8pm peak demand period persists, generating profit for power companies in the evenings when households tend to switch on energy-hungry appliances.
Dr Kuiper said smarter hot water systems offer the biggest and cheapest solution by shifting water heating demand to the middle of the day, when the carbon footprint is smaller, which reduces costs for owners and the system as a whole.
"Passive management" is one way to make the shift, through timers on devices, or ripple control times set by distribution networks for systems on controlled load circuits and tariffs.
The other is "dynamic management" by adjustable ripple control or WiFi controls, set by the owner or a third party, which can be adjusted in response to changing conditions, she explained.
Even for those without solar, running a heat pump hot water system during the day can help absorb excess solar output available in the local grid, and uses electricity with lower emissions intensity.
Some households are taking advantage of "solar sponge" retail tariffs in the middle of the day or participating in so-called retail demand response programs which reward homes and businesses for switching on or off at certain times to ease pressure on the grid.
The average household in Victoria could save $1200 a year on energy bills if ageing gas appliances were replaced with efficient electric alternatives, research by the Institute of Energy Economic and Financial Analysis has shown.
A rapid electrification scenario would save consumers up to $6.7 billion a year by 2024, University of Technology Sydney researchers calculate, with 22 gigawatts or 45 GW-hours per day of flexible demand available - roughly two thirds of peak demand.
This would require no sales of residential gas hot water systems after 2025, with all systems electrified and able to be dynamically managed by 2035.
But with tradies already in short supply, Dr Kuiper says Australia needs a national strategy for domestic hot water, including workforce and trade training measures and new regulations.
