The Crisis Behind Your Power Outlets

The demand for electricity is falling. That hasn't happened since electrification began spreading outside of the cities.

The linked article has a lot of details.

What I wonder about is whether we're going to see a death spiral start forming. Death spirals are when businesses that see a drop in revenue begin raising rates (or prices) to make up for the shortfall. Customers start going elsewhere and that rate accelerates.

For electricity, if the utilities are not selling enough of it, look for them to be coming back to regulators, again and again, seeking rate increases. Businesses that use a lot of power may start rethinking the idea of self-generation of one form or another. Residential customers will look for ways to save electricity. A sign that this is going on will be when the other sources of heat start heavily advertising the lower costs of conversion to another heating method (oil, propane, natural gas). Rate increases will continue to spur conservation and searches for alternative sources. There will be massive consolidation of electrical utilities as they search for efficiencies and close unneeded plants. The death spiral will force them to do it.

Trump's desire to have a renaissance in coal is dead if the utilities don't have the increased demand to justify building new power plants. Even if they do, natural gas is cheap enough and a natural gas-fired plant doesn't need to deal with bottom ash or fly ash or come up with ways to store thousands of tons of ash. Between the need to handle the combustion by-products of coal, the need to maintain a coal yard and to have the machinery and people to move the coal to the inlet conveyors, coal has to be significantly cheaper than anything else in order to make it economical to burn the stuff. Right now, it isn't. The less-efficient power plants that will be the first to close will be the coal-fired ones.

(H/T)