COVID-19 Impact on Electricity

By:
Shaun Pandit, MBA, CEO, Early Bird Power
Anand Seth, PE, CEM, CPE, Independent Consultant
Edward M. Browne, CHFM, CHC, FASHE, Senior Consultant, Early Bird Power

 What do liquor stores, pizza joints and hospitals have in common? You might think the answer is these are places where you might find a healthcare facility manager at different times of the day. But you would be wrong (in most cases). It seems (per Innowatt) that these three business types have increased their use of power more than most other industries 19%, 20% and 16% respectively. Car dealers and dry cleaning have seen the biggest decrease at -67 & -65% respectively.

 These are interesting observations, but what effects can we really expect on our facilities' power consumption profiles during this time of worldwide pandemic? Keep in mind, it's been 100 years since we have seen any type of disruption like this, and as we write this, the HHS Secretary is being lobbied heavily by the American Hospital Association to extend the public health emergency beyond the original deadline of July 25th, as many states start to see a resurgence of COVID-19, so we truly have nothing to go on here.

 Let’s talk about what we do know. Yes, there have been changes in peak loads during the COVID-19 Pandemic. Below is what we know now compared to pre-pandemic days.

 I. Overall
A. Electricity demand dropped sharply when social distancing and work at home protocols began, and is now steadily recovering.

II. Changes in loads
A. Traditionally, morning peak loads were occurring from 6:00AM - 10:00AM, when people get to work; these have been decreased by 4% - 6% in the NE-ISO market as social distancing and work from home measures were enacted across the region and numerous business have closed. These numbers are compared with past year averages during the same months/dates/times.

B. These changes are representative of a more gradual curve in loads, with the morning demand peak becoming a midday peak. Additionally, afternoon peak energy consumption which occurred during 6:00PM - 8:00PM, when people returned from work, is happening earlier, at around 4:00PM - 6:00PM.

C. Load reductions occurred overall across markets, reducing demand and price as well.

D. As hospitals use more ventilation air and the HVAC systems operated in “occupied mode” for extended periods, we would anticipate an increase in load. However, at the same time, many optional procedures were postponed or cancelled. This means consumption would decrease. This is very challenging to quantify. “We saw an increase in our electricity usage in the spring as we increased to 100 percent outside air to our air handlers to help combat COVID,” said Michael Canning, Senior Director of Facilities for Boston Medical Center.

III. Long-term effects of falling prices and the unanticipated consequences of these load changes.
Across all major regions, the power mix has shifted toward renewables following lockdown measures due to depressed electricity demand, low operating costs and priority access to the grid through regulations.

Natural gas has remained the leading source of electricity, while renewables have far outpaced the contribution of coal-fired power plants. Renewables have consolidated their second position after natural gas and way above coal. 

A. The pandemic has caused a “pause” on investments of clean energy projects but may also prove beneficial for the development of these given the changes in peak times. Solar is expected to be benefited the most given that peak generation occurs from 11:00AM - 4:00PM and can be a better fit for the current changes in load profiles.

IV. Effects on Hospitals
As mentioned, all of our institutions are continuing to navigate with difficulty through these new and treacherous water of a worldwide pandemic. We can only estimate what some of the challenges mean as outlined below.

 A. Hospitals and clinics are at the forefront in the battle against COVID-19 but facing an unprecedented rise in costs in terms of PPE, staff, and loss in revenues from canceled surgeries and other services, pressing budgets against their limits.

B. Given hospitals, operating 24/7, are one of the largest energy users in the U.S., budget certainty in this aspect is critical to continuing operations.

C. On one hand, energy use for hospitals, particularly in the current pandemic, has increased given the higher occupancy and operational requirements, most likely beating budgeted usage, and spending. “At Beverly Hospital, our increase in electricity usage was not only driven by increased air flow, but also by the addition of 20 new negative pressure rooms and standing up fully equipped Alternate Care Site within the main hospital footprint “ said Ed Lydon, Director Support Services, North East Hospital Corp. On the other hand, recent shifts in peak times and reductions in demand across the board have taken electricity prices to new lows, creating opportunities to reduce energy costs and help balance the same.

 Stay tuned as “The story is not fully written yet,” says Walt Vernon, CEO of Mazzetti. His firm has engineering efforts underway throughout the U.S. at several hospitals collecting load data in real time to be compared to past profiles. Once fully correlated and analyzed, this data as well as other sources of information will become the basis for future decisions about demand side management within our healthcare institutions.