Americans are using less electricity, a trend that is upending long-held assumptions about energy consumption and the need for new power plants.
Historically, energy usage typically dips amid a recession but quickly recovers. That hasn’t happened in the aftermath of the Great Recession.
To an extent, the trend is playing out locally. Even amid population growth, La Plata Electric Association customers are using less power.
In 2013, La Plata Electric sold about 974 million kilowatt hours of electricity, a 4 percent drop from the previous year. It was the least amount of electricity used by LPEA customers since 2005.
“It’s a fundamental change,” said Greg Munro, CEO of La Plata Electric.
Residential consumption actually rose locally in 2013, a fact Munro attributes to new housing construction. But an even steeper drop-off in industrial use led to lower overall demand for LPEA’s power.
Nationally, residential electricity consumption fell 3 percent from 2011 to 2012, according to the U.S. Energy Information Administration. Total U.S. electric consumption, including commercial and industrial use, fell by a similar amount.
Reduced consumption came despite a rising U.S. population and an expanding economy. Federal government projections forecast essentially flat electric consumption for years to come.
Munro said he doubts residents are sacrificing convenience by using less electricity. Instead, appliances and gadgets are simply more efficient.
Reduced power usage calls into question the need for new power plants. As coal-fired plants are shuttered around the country because of economic and regulatory pressures, the equations are changing for how to make up for that lost power.
Utilities in Colorado and the Four Corners are dealing with the answers.
Under pressure to reduce emissions, Public Service Co. of New Mexico has agreed to wind down two of the four stacks at San Juan Generating Station, a coal-burning plant west of Farmington.
But instead of replacing the lost power with another major plant, PNM plans to build a smaller natural gas “peaking” unit to respond to summertime spikes in power demand.
“Basically, (reduced consumption) did not affect our decision to agree to retire the two units, but it is affecting our replacement power strategy,” said Valerie Smith, a PNM spokeswoman.
The two units’ retirement, expected to occur in 2017, will result in the loss of 836 megawatts of production, of which PNM owns 340 megawatts. PNM’s replacement natural-gas unit is expected to produce only 177 megawatts.
To make up the difference, PNM intends to bring power from the Palo Verde Nuclear Generating Station to customers instead of selling the electricity at wholesale, Smith said.
Reduced electric use did not play a role in deciding to close three of the five units at Four Corners Power Plant, the other large coal-fired plant in northwest New Mexico, said Damon Gross, spokesman for the plant’s operator, Arizona Public Service Co.
That plant, like San Juan, was required by the U.S. Environmental Protection Agency to reduce emissions.
LPEA purchases its power from Tri-State Generation and Transmission, based in Westminster. Tri-State’s most recent power demand projections in 2010 called for increased demand each year through 2029.
A Tri-State spokesman did not return calls seeking comment.
Locally, part of the drop-off in demand stems from reduced consumption by natural-gas compressors, Munro said. Industry use makes up about a third of LPEA’s customer base.
Natural-gas production in La Plata County has fallen precipitously in recent years. It dropped another 14 percent in 2013 to 338 billion cubic feet, the lowest level in Colorado Oil and Gas Conservation Commission records dating to 1999.
Inactivity in the San Juan Basin contributes to lower demand for LPEA’s power.
“If they’re not moving a lot of gas out of the area, that means they’re not compressing as much,” Munro said.
Residential use is a different story locally. Even with greater energy efficiency, residential use actually rose 5 percent in 2013, defying the national trend.
There has been little talk of new projects in the Four Corners to generate power. Meanwhile, utilities across the nation are closing coal power in favor of natural-gas plants, leading to reduced carbon emissions.
Desert Rock, another proposed coal plant near Farmington that would be the area’s third, was issued an air permit in 2008. But the project hasn’t moved forward since the EPA withdrew an air permit in 2009.
America’s reduced appetite for power has left utilities that must plan and project their needs for years in the future in a wait-and-see mode.
“There’s really a glut of power in the U.S. right now,” Munro said.
cslothower@durangoherald.com
