Steven Nadel is Executive Director and Rachel Young is a Research Analyst at the American Council for an Energy-Efficient Economy (ACEEE). This article updates and summarizes a previous ACEEE White Paper on this topic.
Electricity consumption has essentially stopped growing in the past few years. Retail electricity sales in 2013 were 1.9% lower than sales in 2007, the peak year. Some observers have attributed this stalled growth to the 2008 economic recession, while others have suggested a variety of other factors. In this paper we consider which factors best explain changes in electricity use in recent years.
The rate of electricity demand growth in the United States has declined steadily over the last 50 years. Prior to the 1970s energy crises, U.S. electricity sales were growing by more than 5% per year. As recently as the early 1990s, growth was more than 2% per year. Figure 1 illustrates these trends along with Energy Information Administration (EIA) projections going forward.
In the past few years, electricity growth has essentially stopped. As Figure 2 shows, electricity sales peaked in 2007, declined significantly in 2008 and 2009 (the recession is likely an important factor), rebounded in 2010, and have trended downward since. In 2014, due to the cold winter electricity sales were up substantially relative to 2013 in the first quarter but level with 2013 in the second quarter.