The growth of rooftop solar and the increased uptake of energy efficiency account for nearly all of the reduced demand in the Australian electricity grid in the last year, according to a new report.

Falling demand has become the Trojan horse of the conventional, fossil-fuel driven electricity industry, with networks, generators, retailers and regulators framing business models and tariff policies in the last five years around the assumption that demand growth was unstoppable.

But the emergence of rooftop solar and energy efficiency has turned those assumptions on their head, explaining why many of the incumbent utilities are fighting so hard to have policies that encourage solar and energy efficiency measures overturned.