Electricity Use Was Up Last Year, But Why?

(Bloomberg Businessweek) -- A decade ago, electricity use in the U.S. stopped rising. It had fallen briefly during recessions before, so the initial dip in 2008 and 2009 wasn’t a shock. But after bouncing back in 2010, consumption remained unchanged even as the economy continued to recover. This unprecedented plateau, plus a shift away from coal in electricity generation, enabled an almost 15 percent decline in U.S. carbon dioxide emissions. It also exacerbated the coal industry’s troubles and forced utilities to grapple with flat demand.

Over the past year, though, U.S. electricity use rose almost 2.3 percent, the U.S. Energy Information Administration estimates, by far the biggest increase since 2010. The numbers are preliminary and could be a blip. But any change is worthy of attention.

The past decade’s slowdown occurred in part because of a shift toward services and digital products and away from energy-intensive goods, along with efficiency gains driven by government standards, technological advances, and cost concerns. This year’s increase has been almost entirely the doing of consumers. (Industrial consumption fell.) That could mark a setback for energy efficiency or reflect changes in measurement of home solar generation. It could also be tied to greater use of electricity in heating and cooking, mining Bitcoins, and driving electric cars.

Or it could be that everybody had air conditioners on: The continental U.S. experienced the sixth-hottest average temperature and the warmest nighttime lows on record from June through August. Keeping electricity use down can slow climate change, but climate change may drive up electricity use.

● CONSIDER THE CRYPTO

Electricity use by Bitcoin miners dropped recently as prices crashed, but still rose by about 45 terrawatt hours in 2018 overall, based on the Bitcoin Energy Consumption Index compiled by Alex de Vries. But assuming most mining is done overseas, it can’t account for much of an 84TWh increase in U.S. electricity use.

● ROOM TO SHRINK

Energy researcher Jonathan Koomey says the era of big efficiency gains isn’t over: “We’re far from the ultimate physical limits of efficiency, and we’re getting more clever.” —Fox is a business columnist for Bloomberg Opinion.

To contact the editor responsible for this story: Jillian Goodman at jgoodman74@bloomberg.net, Howard Chua-Eoan

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