Industrial electricity consumption continues slide

By the OGJ Online Staff

HOUSTON, Aug. 29 -- Total electricity sales tumbled 2% to 262 billion kw-hr in May led by a 7% decline in industrial consumption, compared to the year earlier period, the government reported Wednesday.

Commercial consumption was up 4% to 87.7 billion kw-hr year over year in May, while residential sales were down 2% to 82 billion kw-hr. May industrial sales fell to 83.6 billion kw-hr and are down 4.9% in the first 5 months of 2001, compared to the same period a year ago, reflecting the continuing contraction in the manufacturing sector.

Residential electricity consumption is up a healthy 8% to 487.2 billion kw-hr for the first 5 months of this year, while commercial consumption has risen 5.4% to 421.9 billion kw-hr, helping offset the slide in industrial electricity sales. Total electricity sales for the first 5 months of 2001 are up 2.8%, compared to the same period in 2001.

Electricity prices were up an average 9% to 6.93¢/kw-hr in the first 5 months of this year, compared to last year. Industrial rates jumped 17.8% to 4.96¢/kw-hr, while commercial rates rose 8.9% to 7.54¢/kw-hr. Residential rates were up 2.6% to 8.14¢/kw-hr.

The Energy Information Administration said industry revenue rose 12% to $94.7 billion in the first 5 months of 2001, compared to the same period a year ago

Receipts for gas totaled 178 bcf in April 2001, down from 200 bcf reported in April 2000. The average cost of gas delivered to electric utilities was $5.64/MMbtu compared to $3.16/MMbtu reported in April 2000, EIA said. The average cost of gas delivered to electric utilities in March 2001 was $5.74/MMbtu.

Less expensive fuel oil has reduced the amount of natural gas consumed by electric utilities, especially in the mid-Atlantic and South Atlantic divisions, the agency said. In addition, EIA noted the sale and reclassification of electric plants is significantly affecting gas receipt data in New England, the mid-Atlantic, and Pacific regions.

Receipts of coal at electric utilities totaled 60 million short tons in April 2001, down 3 million short tons from the level reported in April 2000. EIA attributed the decline to data for the Tennessee Valley Authority not being available at the time of publication, in addition to the sale and reclassification of utility plants as nonutility plants. Plants recently reclassified as nonutility aren't required to report fuel receipts to federal regulators.

EIA said receipts of petroleum totaled 10 million bbl, up nearly 5 million bbl from the level reported in April 2000. fuel. For the month, the average delivered cost of fuel oil was $4.05/MMbtu, up from $3.90/MMbtu reported in April 2000.

While the sale and reclassification of plants has tended to reduce fuel oil receipts over the past year, the agency said the increase in petroleum receipts is due primarily to some utilities switching from natural gas to a less expensive fuel oil as a replacement.