Reduced demand for electric power is a result of the Coronavirus pandemic.
The first signs of demand reduction for power are out there. The Mid-Atlantic region reports that a typical 100,000-megawatt day was just 94,000 on the first day of “social isolation.” (Source)
The Wall Street Journal reported, “In the Seattle suburbs, Snohomish County Public Utility District saw a 3% drop in electricity demand.” It also said other areas of the west coast have a reduced power demand.
To show how sensitive demand is, check this: “The peak electricity pull from the grid has also shifted from about 8 a.m. to an hour later.”
It is not just the U.S., but Europe, too. “Compared with mid-March 2018, demand this week is down 22% in France, 19% in Italy, 11.6% in the UK and 4.5% in Germany.” (Source)
Reduced demand means less money in the door for power companies, an industry with significant capital costs and high capital investment. While certain utility projects can be postponed, not all can be postponed. These companies always provide an essential service and must maintain the grid.
Customers are the sole source of income for utilities. We’ll see how a reduction in revenue hits utilities that have high debt and minimal financial flexibility.