In order to ‘keep the lights on’ power systems are sized to be able to meet peak levels of demand. That means enough generating capacity to produce the electricity at peak times, and enough grid capacity to get it to consumers.
Most of the time this capacity isn’t being used though, the chart below providing a prime example. It shows the peak electricity demand on each day in South Australia, during 2017.
For most of the year, from March through November, peak demand doesn’t exceed 2,300MW. Yet the system needs to be sized to deliver peaks up to just over 3,000MW (30% higher). In fact the top 10% of capacity was only needed on three days in that year. That’s a lot of investment sitting under-utilised for most of the time!