Why has US electricity demand failed to rebound from the Great Recession? John Diefendorfer, director of the Energy Information Administration’s office of electricity, coal, nuclear and renewables analysis, postulated several possible reasons in his conference presentation.
Improved energy efficiency has contributed to flat demand, with consumers and businesses replacing older appliances and equipment with newer versions that consume less electricity.
Meanwhile, utilities have rolled out smart-grid infrastructure to promote better understanding of usage patterns and optimize these systems to limit waste and reduce overall consumption.
By the same token, sub-metering enables landlords to monitor and control energy use within individual units, sticking the heaviest consumers with higher bills.
The rise of rooftop solar and other forms of distributed generation likewise reduces energy demand.
Rising income inequality since the Great Recession has also taken a toll on demand, as many Americans have cut back on air conditioning and heating to lower their bills.
Downsizing among retiring Baby Boomers and greater awareness of energy conservation among Millenials have also contributed to this phenomenon.
Taken together, these factors explain the nonexistent recovery in electricity demand after the Great Recession.
Whether this “zero load growth scenario” will persist is the subject of much debate.
Your complete guide to energy investing, from growth stocks to high-yielders.
In October 2012, renowned energy expert Elliott Gue launched the Energy & Income Advisor, a twice-monthly investment advisory that's dedicated to unearthing the most profitable opportunities in the sector, from growth stocks to high-yielding utilities, royalty trusts and master limited partnerships.
Elliott and Roger on Mar. 30, 2017
Balanced portfolios of energy stocks for aggressive and conservative investors.
Our take on more than 50 energy-related equities, from upstream to downstream and everything in between.
Our assessment of every energy-related master limited partnership.
Roger Conrad’s coverage of more than 70 dividend-paying energy names.