U.S. power use to drop over 3% in 2020 due coronavirus: EIA

FILE PHOTO: Windmills are seen behind electricity pylons in Palm Springs, California, U.S., November 25, 2017. REUTERS/Lucy Nicholson

(Reuters) - U.S. electricity consumption will drop 3.4% in 2020 as coronavirus lockdowns caused businesses to close, the U.S. Energy Information Administration (EIA) said on Tuesday in its Short-Term Energy Outlook (STEO).

EIA projected retail power sales will drop to 3,623 billion kilowatt hours (kWh) in 2020 from 3,750 billion kWh in 2019 before rising to 3,655 billion kWh in 2021.

That would be the biggest annual percentage decline since 2009 when sales fell 3.7% and compares with an all-time high of 3,859 billion kWh in 2018, according to data going back to 1949.

If power consumption falls as expected in 2020, it would be the first time since 2012 that demand declines for two consecutive years.

EIA said natural gas’ share of generation will rise from 37% in 2019 to 40% in 2020 before dropping to 35% in 2021 as gas prices increase. Coal’s share will slide from 24% in 2019 to 18% in 2020 before rising to 22% in 2021.

Nuclear’s share will rise from 20% in 2019 to 21% in 2020 and 2021, while renewables will rise from 17% in 2019 to 20% in 2020 and 22% in 2021. Both nuclear and renewables will top coal for the first time in 2020.

EIA projected power sales to commercial and industrial consumers will drop by 7.4% and 5.8%, respectively, in 2020 from 2019 as offices close and factories run at reduced capacity.

Electricity sales to the residential sector will hold steady in 2019 and 2020 as mild weather reduces heating and air conditioning use even though government lockdowns are causing many people to stay home.

While both residential and commercial sectors consumed record amounts of electricity in 2018 at 1,469 billion kWh and 1,382 billion kWh, respectively, the industrial sector set its all-time high of 1,064 billion kWh in 2000.

Reporting by Scott DiSavino; Editing by Richard Chang