[Extract] The cost of electricity charged to consumers in Australia is predominantly set by state governments and does not vary depending on the actual cost that the electricity retailer has to pay the generators. This does not encourage users to reduce power at times of peak demand and the ratio between the peak demand and the average demand is growing. In the long term, user pays principle must apply and the cost of electricity charged will need to vary depending on the actual cost of production. This requires a communication system to be produced firstly to determine the date and time electricity is used, so that the usage and actual cost can be matched, and secondly to inform the consumer of the actual cost of electricity, so that appropriate actions can be taken, like turning off air conditioners when the cost per kW becomes high
