After Four Weeks of COVID-19, Overall Demand is Down, Residential Energy Use is Up, and NG is Keeping the Lights On

Published On: April 20, 2020

California is 30 days into the COVID-19 stay-at-home orders. Office buildings, hotels, retail spaces, and industrial sites are idle, creating a significant impact on California’s economy. It is also impacting California’s energy demand.

According to California Independent System Operator (CAISO) data, the stay-at-home order for the past 30 days has resulted in an energy demand decrease of more than 8%, and a power demand decrease by more than 12% over the past week alone. While this does not consider the effects of weather or other impacts on energy demand, it does show a dramatic drop in power usage. Despite the decline in overall demand, earlier this month the California Public Utilities Commission (CPUC) noted seeing a 15 to 20% increase in California’s residential electric use. We anticipate that this could actually grow as temperatures warm in the coming weeks and months. Mild climate thus far has been great, but with hot months ahead and everyone working and learning from home, all energy consumption will come from the home. With meals being prepared at home and the likelihood of dishwashers and laundry happening even during “peak” pricing hours, that energy consumption will likely be more than normal. Consumers may soon realize just how expensive that could be.

Given this likely power demand surge at home, will the CPUC’s triggering of the existing programs be enough to help home energy use for those on already stressed budgets due to COVID-19? We anticipate that the CPUC and the legislature may look into this more – especially if the stay-at-home orders are not at least partially relaxed in the coming summer months.

During the pandemic, how is California meeting increased home demand while commercial and industrial use are down? CAISO figures show that during the first month of the stay-at-home order, natural gas power was up more than 1,600 megawatt-hours (MWh) compared to last year. Nuclear power is also up more than 110 MWh. Coal and battery power are roughly identical to the previous year.

Meanwhile, imports are down slightly (57MWh) and renewables are down more than 800 MWh. The dry 2020 rain season, has led to a significant drop in large hydropower, as it is down more than 2,500 MWh. These figures do not take into account planned outages at facilities for maintenance and repair. However, the statistics clearly illustrate the lockdown is likely creating power scheduling difficulties.

CAISO has stated that load forecasting is more challenging due to a lack of historical statistical data for a pandemic event and that staff is taking steps to reduce forecast errors in its day-ahead and real-time markets.

As the weather begins to warm, and if there is no relaxing of the stay-at-home orders, we may see some bigger challenges. We will continue to monitor the state’s power supply and demand during the pandemic and keep you posted as the legislature and regulators react.

 

About the Author: Matt Ross

Matt Ross is a Senior Consultant in the energy industry and has more than a dozen years of experience in state government. He can be reached at matt at govreport.org