Christopher Martin (Bloomberg) -- The closures of schools, factories and offices to prevent spread of the coronavirus will “profoundly impact” the U.S. power sector, according to BloombergNEF.
Already in New York, electricity use dropped about 7% during the week ending March 25, and prices are down about 10% as the state has ordered nonessential businesses to close, BNEF said in a report Friday. Demand and power prices are also down in California and New England.
“There are clear demand trends in New York, New England and California, but it hasn’t hit the Midwest or Texas,” Josh Danial, an analyst at BloombergNEF, said in an interview. “That was a surprise to us.”
Expansion of work-from-home and travel restrictions in other regions will likely have a greater impact on power demand in coming weeks, he said. For now, demand in Texas and the Midwest is up slightly, which may be because of increased use of data centers and fewer travel restrictions, Danial said.
The recent collapse in oil prices is likely to change that dynamic in Texas.
“We expect the load in Texas will drop off a cliff,” Danial said.