Peak loads, health, and energy equality: The effects of demand-side electricity efficiency interventions

Electrification is key for climate change mitigation but, if unmanaged, risks increasing energy poverty, inequalities, and peak electricity demand. While demand response to reduce peak electricity demand has been the subject of extensive research, the effects of energy efficiency interventions for wider health system and socioeconomic outcomes are less studied. This study assesses the impact of seven energy efficiency interventions on peak electricity demand in residential neighbourhoods in Aotearoa New Zealand, and compares these effects with wider system outcomes, including demonstrated direct health system costs. Using a validated agent-based model of energy use, electricity demand is simulated across socioeconomic and geographic conditions. Most energy efficiency interventions reduce peak electricity demand, with reductions of 0.08-1.64 kW/house (4-37%). Socioeconomic variations highlight the importance of targeting energy efficiency interventions to maximise whole-system outcomes. This study suggests increasing efficiency standards, accompanied by subsidies for low-income households, would enhance these benefits. However, average effects are skewed towards the highest-income neighbourhoods and do not represent the bottom 75% of neighbourhoods, meaning targeted subsidies would be preferable to avoid policy choices appearing biased towards wealthier segments, as well as being preferable in terms of economic efficiency and avoiding any increase in existing inequalities and energy poverty.