- Sep 14, 2020 7:04 pm GMT
This article is republished from the April 2020 issue of Strategies, AESP’s exclusive magazine for members. To receive Strategies, please consider joining AESP.
A broad Roundup of Covid-19 Impacts on the Energy community
Special for AESP by Paul Korzeniowski
The coronavirus pandemic swiftly shut down the global economy. To slow the spread of the disease, companies closed shop, and consumers hunkered down in their homes. The sudden and dramatic changes has profoundly reshaped how the energy efficiency community operates. The impact is being seen in shifting energy loads, a financial shakeup, a revamping of energy efficiency employees’ workday, new cybersecurity threats, and the stalling of legislation.
Energy Load Shifts Because of Coronavirus
Energy is one of the prime drivers of the U.S. economy. The country consumes about 100 quadrillion BTUs of energy per year, according to the U.S. Energy Information Administration. When the nation grinded to a sudden stop, one ripple effect is individuals and businesses doing less: less work, no group gatherings, limited commuting, fewer face-to-face interactions and only necessary traveling. The end result translates into consuming less energy. How much less is a fluctuating calculation. Bloomberg found that in Italy electric power demand dropped 7% once comprehensive restrictions were put into place.
Another change came in how energy was consumed, because how people spent the week changed significantly. The typical weekday rush to the city where individuals housed themselves in cubicles was replaced by waking up and booting up a home computer to either work remotely; look for work if one joined the unemployed rolls; or keep oneself and little ones busy.
Many individuals had more free time: no morning and evening commutes, trips to the gym, visits to client sites, going to the movies, eating out, or attending sporting events. They passed the time watching videos and streaming shows; reading books and ebooks; Facetiming; and playing video games. As the shutdown took hold in South Korea, Italy, and Seattle, residential Internet rose 40%, according to National Public Radio.
So what does that mean for the grid? Less energy is needed in the typical weekday hubs, such as urban downtowns and office parks. More energy is consumed in suburban neighborhoods. In sum, the weekly energy usage pattern closely resembled the traditional weekend.
The Financial Impact
The financial area is another spot in need of significant adjustment. As companies shut down, the economic engine got stuck in neutral. Goldman Sachs projected that U.S. Gross Domestic Product (GDP, the amount of money that the country generates) would drop by 34%. The negative economic news cast a large shadow. Companies closed up temporarily or in some cases for good, and individuals were laid off. In the last two weeks in the second quarter, the U.S. set a new record for unemployment claims at close to 10 million.
As people are put out of work and corporations close up shop, they have trouble paying their bills. Many state legislatures passed measures asking and, in some cases, forcing energy companies to provide grace periods for individuals, families, and businesses that were not in a position to pay their monthly utility bills. Eventually, energy companies may eat those costs and have less revenue to cover their own expenses, including funding energy efficiency initiatives. The downturn also reduced tax revenue, so local and state governments have less to fund such programs as well.
Given their dire economic situation, will consumers look to energy efficiency to trim their expenses? Nationwide, households need to cut back, and reducing their energy bills is one way to curb expenses. In response, utility energy efficiency education efforts picked up.
Northwestern Energy and San Diego Gas & Electric, among others, posted energy saving tips for people working at home on their web sites.
Boots Placed Carefully on the Ground
When the emergency was announced, many energy companies closed offices and sent personnel home to work. Most managers could work remotely if they had the right home technology. Such issues were more complicated for groups, such as field service teams, who visit customers’ homes, offices, and retail establishments. Were they shut down? Within the electricity sector, the U.S. Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA) listed nine categories of workers as critical, including mutual assistance personnel; workers at generation, transmission and electric blackstart facilities; and workers needed for safe and secure operations at nuclear generation.
Utility companies took steps to ensure their staff’s safety on the job. They enacted hygiene practices when individuals enter or leave a facility. In another example, Southern California Edison suspended all energy audits and instead began promoting its online energy tool for residential customers. In all utilities, when making emergency visits to homes or businesses, employees need to outfit themselves with gloves, masks, and hand sanitizer.
Cybersecurity Measures Ramp Up
Amid the pandemic also emerges humanity’s dark side. CISA noted that hackers were trying to use the global health pandemic to their advantage. A rise in malware and phishing hit as criminals tried to leverage the mass confusion to wedge their way into enterprise computer systems. CISA noted that threats against critical national infrastructure also rose. Health care facilities were the main target but energy grids represent another possible target. In response, CISA recommended that utilities closely monitor and update as necessary their security checks, such as Virtual Private Networks, user authentication, and encryption that they rely on to protect sensitive company and customer information.
Energy efficiency legislation took a hit. The federal government’s $2 trillion stimulus bill did not include any funding for energy efficiency initiatives. Progress on state initiatives was muted in a number of cases.
Maryland’s Climate Solutions Act focused mainly on reducing carbon emissions, but included passages designed to spur energy efficiency. The bill increased mandated annual efficiency savings to 2.8%, up from its current 2% requirement and all new buildings meet net-zero emissions standards. Another possible bill was designed to help low-income households increase energy efficiency, setting an annual incremental gross energy savings of at least 1% starting in 2021.
In Minnesota, HF 4502 is essentially an update and modernization of the state’s previous energy efficiency goals. The new bill includes a number of energy efficiency measures and is designed to boost its annual energy efficiency savings to 2.5%.
The Clean-up Awaits
The Covid-19 pandemic impacted humanity across the globe. In the energy efficiency arena, companies were hit with changes that made it more difficult to push energy efficiency initiatives forward, inevitably resulting in staff layoffs. Like other areas, the clean-up from these ripple effects is expected to be felt in the coming months and years.
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