Setting it straight on dodgy power stats

Faulty wiring in communication channels often gives new statistics an added element of shock, as with ABS data showing a misleading 25 per cent increase in electricity use.

You can demonstrate just about anything with statistics, depending on how you play with them.

So most recently we've had media running with the information that, according to a new report from the Australian Bureau of Statistics, our households are using 25 per cent more electricity than a decade ago.

Goodness.

Does it sound quite the same, however, when one also reports – using information from the Energy Supply Association of Australia yearbooks – that the number of households registered as electricity account holders has risen from 7.27 million at the start of the century to 9.09 million in 2010-11?

Yup, that’s an increase in the number of households of 25 per cent.

SBS News, for example, might have paused to ask the association a question before it ran its story that "electricity use is up 25 per cent despite price hike,” pointing to the "sky-rocketing” increase in power bills since 2007.

Yes, dears, that’s because there are a lot more account-holders over 10 years and we are mostly a lot more affluent, using many more air-conditioners, plasma TVs and other thirsty appliances.

And the combination of more demand and the need to replace old infrastructure as well as governments increasing network reliability requirements – and, most recently, green schemes like solar subsidies and the carbon price – has sent the prices up.

Context would be a fine thing, but we don’t get lots of that in the 24/7 – 'look, there’s a rock' – media goldfish bowl and, as a result, we have a population with some skewed ideas of what is actually going on.

Using the ESAA yearbooks, one can also see that residential demand in New South Wales and the ACT has risen in a decade from 18.45 terawatt hours to 21.37 TWh, while Queensland consumption has gone up from 9.63 TWh to 13.09 TWh – and Victoria has moved from 12.26 TWh to just 12.71 TWh.

Victoria plus the jurisdictions north of the Murray account for 78 per cent of all household power demand in Australia – and residential consumption has gone up just under 17 per cent in this region in the decade.

By comparison, Western Australian residential demand has risen 61 per cent in a decade. Hello, boom.

The Queensland comparison is an increase of almost 36 per cent, reflecting the shift in population to the state’s south-east, the marked increase in use of air-conditioning and, of course, the flow-through affluence from the mining boom.

The ABS stuff includes an interesting graphic – you can find the "Australian Social Trends” report on the bureau’s site under the sub-title "Household energy use and costs” – setting out comparative energy use (in petajoules) by jurisdiction and energy form.

Thus, nationally, we see that households consumed 223 PJ of electricity in 2010-11, with New South Wales (and the ACT) using almost as much as Victoria and Queensland homes put together and all the other states together barely using more than Queensland.

Households also consumed 148 PJ of gas with Victoria accounting for 100 PJ – that’s the Sir Henry Bolte effect because the wily old Victorian premier did a job on Esso and BHP in the 1960s to get really cheap gas on long term contracts from Bass Strait, resulting in a very high take-up of the fuel for cooking, heating and hot water in the state.

The two other forms of household energy – LPG and solar power – account for just another 22 PJ, or 5.6 per cent of consumption.

Economists can be a dry lot so we get the ABS spokesperson saying with a straight face that: "We found that the types of energy most commonly used by households were petrol and electricity followed by natural gas.”

Yeah, that would be right.

Mind you, I reckon the nation’s statisticians could do a little better than telling us that 74 per cent of energy consumption is by "industry".

People out in the street need to be told that a great chunk of it is in commerce (that’s the shopping malls and office blocks, folks) and public services (hospitals, school and other education institutions) and a growing bit in mining as well as the 30 per cent or so that accrues to factories. There’s a chunk that is used in public transport, too.

My point, of course, is that this is not about "us” and "them” but about "us” in many manifestations (householder, commuter, shopper, worker, small business persons) and "them” (who happen to directly employ a million of "us”).

By the way, on the pricing issue, electricity bills nationally rose 72 per cent in the five years to 2012 – not a "shocking 72 per cent in 10 years” as reported by the tabloids – compared with 45 per cent for gas and other fuels. The CPI increase was 15 per cent.

The biggest single jurisdictional energy increase, by the way, was not for electricity – with Melbourne retail bills going up 84 per cent in five years and Sydney costs 79 per cent – but for gas in Western Australia: Perth’s household gas bills rose 88 per cent between June 2007 and June 2012.

What I couldn't find reported in any of the media articles up on Google News last week was this not unimportant paragraph in the ABS survey:

"In 2009-10 electricity, gas, heating oil and wood accounted for $32 per week of household expenditure. Although this was a real increase of nearly $5 per week (at 2009-10 prices) since 2003-04, the amount as a proportion of total real household expenditure remained at 2.6 per cent.”

The ABS adds that 13 per cent of households were under financial stress in 2009-10, reporting being unable to pay electricity, gas or telephone bills on time.

I should think the figure is higher now, but we still lack a decent piece of analysis as to what’s causing this stress. Instead, we get the tabloid talk, sooled on by the prime minister, that "power prices are the new petrol prices".

Well, there’s a bit more to it than this, don’t you think?

En passant, I note that a survey last year found that less than a quarter of the nation’s flats, units and apartments had insulation and almost a third of all households didn’t have it. (The rented houses would help to push that figure up.)

What this stat doesn’t throw up is that most Australian homes also have some of the poorest glass in the developed world, with consequent impacts on energy consumption for heating and cooling.

Something like 55 per cent of the heat lost from buildings in winter literally goes out the windows.

It’s a complex story and not made easier to understand through the way it is communicated by media, lobbyists, ideologists or pollies.

Keith Orchison, director of consultancy Coolibah Pty Ltd and editor of 'Powering Australia' yearbook, was chief executive of two national energy associations from 1980 to 2003. He was made a Member of the Order of Australia for services to the energy industry in 2004.

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