THE biggest revolution in electricity supply is happening right on top of you, and it is only going to get bigger.

Rooftop solar power is expanding so rapidly it is lowering the demand for electricity from traditional sources and placing a death sentence on thermal electricity.

Solar images from the Queensland suburb of Stafford, in Brisbane. Picture: AAP/Glenn Hunt
Solar images from the Queensland suburb of Stafford, in Brisbane. Picture: AAP/Glenn Hunt

Coal might still be king in the power industry - currently providing some 48 per cent of our electricity needs nationally - but home-based solar is growing significantly.

And with that come problems such as risks to reliability and reduced call on power stations, thus pushing up prices.

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That's a finding in the review of electricity delivery in 2016-17 by industry policing agency the Australian Energy Market Commission (AEMC).

The review said household solar and energy-efficient household appliances would lower family power bills by cutting reliance on power generators.

The AEMC forecast that by 2035-36 NSW roofs would be generating more than 18.6 megawatts of electricity. That's about 40 per cent of the total generated by the national network at present.

The AEMC warns this could produce a hollowing effect when solar generation ends at sundown and battery storage is inadequate to serve demand overnight.

Renewable energies at sunset
Renewable energies at sunset

"In terms of demand, increased rooftop PV (solar power) can exacerbate the difference in demand levels during the middle of the day, when PV output is at a maximum and therefore significantly reduces demand, and early evening, when PV output declines," said the review.

"This can result in a 'hollowing out' of the typical daily demand curve."

The review said increased battery storage could resolve the problem, but that reliance on power stations would be reinforced.

It said: "One potential implication of this is to smooth out the midday troughs and late afternoon peaks in the demand curve caused by solar PV without storage.

"Finally, the (AEMC) panel notes integrated PV and storage systems may also influence how customers value the reliability of the supply of electricity from the grid, as these systems may at least partly insulate households and small businesses from the impacts of interruptions in grid supply."

The AEMC said the growth of solar would not remove the reliance on coal and gas-fired power generation.

Coal-fired power stations currently accounted for 65 per cent of electricity produced in Queensland, 62 per cent in NSW, and 42 per cent in Victoria.

Gas-fuelled generation produces 62 per cent of South Australia's power.

However, the role of coal is shrinking.

"In 2016/17, 1808MW of (coal-powered) generation was formally withdrawn. The most significant withdrawal was the closure of the Hazelwood Power Station in Victoria," said the review.

This represented three per cent of national generation.

The review reported: "It has been announced that 2064MW of generation will be withdrawn from the NEM by Mid-2022. All of the generation units announced for withdrawal are thermal, synchronous units.

"AGL has announced its intention to withdraw the Liddell Power Station (2000MW) in New South Wales in March 2022.

"Stanwell has announced its intention to withdraw the Mackay GT Power Station (34MW) in Queensland in July 2021."