Industrial slowdown hurts demand for power

By the OGJ Online Staff

HOUSTON, July 6 -- The US industrial sector's electricity consumption declined 4% to 82 billion kw-hr in February, compared to the same period a year ago, reflecting the slowdown in the US economy, a government agency said.

Sales to the residential sector were up 3% to 101 billion kw-hr in February from the year earlier period and electricity sales to the commercial sector rose 2% to 80 billion kw-hr, the US Energy Information Administration said in a monthly report.

The EIA report also underscores up how much high gas prices contributed to fuel switching by the electric industry earlier this year. January receipts of petroleum totaled 17 million barrels, up 14 million barrels from the level reported in January 2000.

While the sale and reclassification of plants have reduced fuel oil receipts over the past year, the increase in petroleum receipts is due to utilities switching from natural gas to a less expensive fuel oil as a replacement fuel, EIA said.

In addition, the agency said extreme cold weather over much of the nation during December 2000 and January 2001 required some electric utilities to bring additional petroleum-fired capacity online. The average delivered cost of fuel oil was $4.71/MMbtu, up from $3.78/MMbtu reported in January 2000.

Gas receipts totaled 135 bcf, down from 170 bcf reported in January 2000. The average cost of gas delivered to electric utilities was $9.21/MMbtu, compared to $2.71/MMbtu reported in January 2000.

EIA said this is the highest average monthly price of gas reported by electric utilities since data collection began in 1972. As with coal and petroleum, the agency said, the sale and reclassification of electric plants is having a large effect on gas receipt data presented at the New England, mid-Atlantic, and Pacific contiguous census divisions, as well as at the national level.

Total US net generation of electricity was 286 billion kw-hr in February 2001, 1% below the amount reported in February 2000. Electric utilities generated 203 billion kw-hr or 71% of the total in February 2001, and nonutility power producers generated 84 billion kw-hr or 29% of total generation.

During the first 2 months of the year, total US net generation of electricity was 620 billion kw-hr, 1% higher than the amount reported during the corresponding period in 2000. Some 53% of the generation was produced by coal-fired plants, 21% from nuclear, 13% from gas, 6% from hydro, 5% from petroleum, and 2% from renewables.

For the first 2 months of 2001, nonutility generation was up 60% to 177 billion kw-hr, compared to the same period in 2000. Meanwhile, utility generation fell 12% to 442.9 billion kw-hr from 503.3 kw-hr in the same period 1 year ago.