WASHINGTON, DC—Resources for the Future (RFF) today released a new installment of Resources Radio: “How COVID-19 Has Powered Down the US Economy, with Steve Cicala.”
In this episode, host Kristin Hayes talks with Professor Steve Cicala of the University of Chicago’s Harris School of Public Policy (soon to be moving to Tufts University’s Department of Economics). Expounding on research recently highlighted in the New York Times, in which he undertook one of the earliest looks at electricity demand during the peak of the pandemic lockdowns in the United States, Cicala details how electricity demand can serve as a valuable—if incomplete—tool to assess the health of the economy and the outlook for recovering from a recession. Cicala notes that the current crisis has shifted renewable penetration and affected energy consumption, but researchers remain uncertain about the duration of the pandemic and its long-term impacts on the electric grid.
This is the first episode in an ongoing webinar series, which is providing Resources Radio listeners the chance to listen to a podcast recording live and ask guests their own questions about pressing energy issues.
Notable quotes from the podcast:
- Working from home might be increasing electricity demand: “It was in the past couple of weeks where it looked like there was this sudden miraculous recovery in the US economy. [Electricity demand had] been down by about 7 percent, and then within the course of two weeks … shot up to basically back to normal … It's looking like this is because people are working from home. It's really just in those two weeks that anyone has really started firing up their air conditioners in any meaningful way.” (7:37)
- Declining energy consumption has catalyzed a transition to renewables: “I think [this shock] has foreshadowed what running a grid with higher renewable penetration is going to look like … The reduction in electricity consumption that we saw happened right in the heart of when electricity consumption was already low … I think [this] gave a lot of system operators a preview of how it's going to be managing a grid, because … you're getting all of this power from renewable sources, and there really isn't too much consumption to soak that up, and really less room to be firing up coal-fired and gas-fired plants to meet demand.” (19:56)
- Consumer confidence can affect demand more than lockdowns: “In Europe, they've eased many of these restrictions, but electricity consumption is still down. I think that as contact-tracing apps [become more prominent], you'll start to really see economic behavior following the confidence that the virus is under control.” (31:54)
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