Studies on the impact of COVID-19 on energy sector

[jiweiqi]

Chen, Yize, Weiwei Yang, and Baosen Zhang. "Using Mobility for Electrical Load Forecasting During the COVID-19 Pandemic." arXiv preprint arXiv:2006.08826 (2020). url Github

[jiweiqi]

https://energyathaas.wordpress.com/2020/11/09/four-facts-about-covid-and-u-s-electricity-consumption/ https://www.stevecicala.com/papers/powering_wfh/powering_wfh.pdf This paper documents an increase in residential electricity consumption while industrial and commercial consumption has fallen during the COVID-19 pandemic in the United States. Hourly smart meter data from Texas reveal how daily routines changed during the pandemic, with usage during weekdays closely resembling those of weekends. The 16% residential increase during work hours offsets the declines from commercial and industrial customers. Using monthly data from electric utilities nationwide, I find a 10% increase in residential consumption, and a 12% and 14% reduction in commercial and industrial usage, respectively, during the second quarter of 2020. This contrasts with the financial crisis of 2008, which also witnessed a rapid decline in industrial electricity consumption, but left residential usage unaffected. The increase in residential consumption is found to be positively associated with the share of the labor force that may work from home. From April through July of 2020, total excess expenditure on residential electricity was nearly $6B.

[jiweiqi]

https://www.energypolicy.columbia.edu/research/report/potential-implications-covid-19-crisis-long-term-electricity-demand-united-states EXECUTIVE SUMMARY The ongoing COVID-19 pandemic has caused unprecedented changes in the ways people interact and approach economic activities. Electricity demand has declined and usage patterns have been altered, changes that could remain even after the pandemic ends. Failure to properly account for these declines in demand could lead to excess capacity in the electric power sector, added costs for consumers, and losses for investors.

This paper, from the power sector program at Columbia University’s Center on Global Energy Policy, presents a methodology to quantify potential permanent reductions in demand triggered by the pandemic. The authors first identify how electricity demand changed in the United States following the 2008–2009 global financial crisis, or “Great Recession,” the last event to cause a major reduction in consumption. They then analyze the unique ways in which demand patterns may change over the next three to five years as a result of the coronavirus, followed by some illustrative calculations of the potential impact. Finally, the authors discuss the implications for policy makers with regard to electricity sector evolution.

The paper finds that the COVID-19 crisis is likely to result in a long-term decline in annual electricity consumption, though less than that observed after the global financial crisis. It is also likely to accelerate changes in the structure of electricity demand that were already underway. In addition, the research shows:

Patterns of load growth changed significantly after the Great Recession, with average annual consumption (load) growth in the preceding decade (1998–2007 inclusive) of 1.7 percent versus 0.5 percent in the decade after (2010–2019 inclusive); Behind-the-meter generation (which is generally a small-scale and often renewable resource installed on a customer’s premises) and energy efficiency were the key drivers of the reduction in load growth after the Great Recession, reflecting trends gathering force before the downturn; Experience from the global financial crisis suggests that load is unlikely to immediately revert to previous levels following the impact of COVID-19, and that load growth may be further dampened; Primary drivers of changes in electricity demand following the coronavirus Great Lockdown are likely to be due to changes in residential demand and shifts in commercial usage, resulting in a potential net incremental reduction in load of 65.2 Terawatt hours (TWh) to 158.8 TWh, or approximately 1.6 to 4.0 percent of US 2018 load; and As a result of this potential reduction in demand, all else remaining equal, future need for baseload generating capacity may fall by more than 28 GW. This paper is intended primarily to explore the magnitude of potential long-term permanent demand destruction due to COVID-19. Because it explores policy implications at a high level, detailed analysis of particular policy recommendations is beyond the scope of the research.

[jiweiqi]

https://epic.uchicago.edu/area-of-focus/covid-19/