Victorian peak demand analysis An independent report prepared by EnergyQuest

Victoria's energy landscape encompasses a diverse array of sources, including natural gas, oil, coal, and renewables. Notably, natural gas accounts for 23% of the energy mix and serves a crucial role in meeting energy demand, especially during peak periods like winter when both heating and electricity consumption rise. Despite the government's Gas Substitution Roadmap proposing a shift towards renewables and electricity to reduce emissions, this report underscores the challenges of full electrification. It reveals that electrifying gas supply could lead to increased electricity demand and supply risks, particularly during peak hours, potentially exacerbating existing shortages. The report also highlights the importance of natural gas supply in ensuring energy stability and mitigating price volatility, pointing to the Australian Energy Market Operator's forecasts that predict significant gas consumption until at least 2042. In light of these factors, the report emphasises the need to consider the continued role of natural gas to address energy shortfalls and stabilise prices, even as alternative pathways towards emission reduction, such as renewable gases, are explored.