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1 1 (June 12, 2020)

handle is hein.crs/govdczw0001 and id is 1 raw text is: Researh Sevice COVID-19: Potential Impacts on the Electric Power Sector Updated June 12, 2020 The Coronavirus Disease 2019 (COVID-19) pandemic is impacting the electric power sector directly (e.g., illness and fatalities among workers) and indirectly (e.g., reduced electricity sales). Most indirect impacts to date have been caused by the economic effects of the pandemic. Long-term impacts are highly uncertain and likely depend on the pandemic's ultimate toll on U.S. public health and the economy. Potential impacts over the coming months include continued reduced electricity sales, increased electric reliability risks, reduced utility bill payments, and delayed or reduced industry investment activity. Reduced Electricity Demand Electricity demand is determined mainly by weather patterns and economic activity. Economic activity in recent months declined across the country, as governments took actions to slow the spread of COVID- 19. These actions forced many businesses to close or curtail operations. Many U.S. states saw electricity demand drop between 9% and 1300 in March and April 2020 relative to previous years, although some (e.g., Florida) have not seen significant changes. With some states easing restrictions on businesses in May 2020, electricity demand rebounded somewhat, but it remains lower than May 2019 in many areas. Reduced electricity demand tends to lower wholesale electricity prices in the near term, as is also the case for other energy commodities like gasoline. Prices in most wholesale electricity markets, which operate in some parts of the country, declined between 22% and 37% between mid-February and mid-April. Consumers may not see lower retail electricity prices, though, because of the timeline of electricity rate regulation by states. Reduced electricity demand could persist for months or longer. As of June 2020, the U.S. Energy Information Administration (EIA) projects a 5.7% ( drop in annual electricity demand in 2020 compared to 2019. If demand and prices remain low for an extended period, some power plants may become unprofitable. This could accelerate recent trends of changing conditions in the sector that affect profitability. Additionally, utilities may delay or cancel construction of new power plants. Congressional Research Service https://crsreports.congress.gov IN11300 CRS NS GHT Prpred For Meumbers and Comrm ttees of Conress ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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