Despite many offices across the country remaining empty, the UK has returned to pre-Covid levels of energy usage.
That’s according to the latest research from Cornwall Insight, which shows that energy demand has been rising back towards 2019 levels since July, having dropped off a cliff edge at the end of March.
The day after the UK Government instituted a nationwide lockdown, energy usage dropped 13%. That drop was sustained for most of the lockdown period, with the average reduction in energy usage sitting at around 15%. Things began to pick up as restaurants and retailers began to reopen in June, however, it wasn’t until July that things began to return to pre-lockdown levels.
While July continued to be below energy usage levels seen in 2019, the beginning of August saw a return to normality. In fact, it was the first time the UK had returned to 2019 levels of energy usage since Covid-19 lockdown measures were introduced.
It’s not unexpected to see energy usage once again rise, and the above average temperatures in August may have contributed to that somewhat, but it’s certainly surprising to return to pre-Covid levels when so many office workers continue to work from home. Of course one explanation could be that offices are typically equipped with more energy efficiency technologies than the average home, with building controls making a huge difference.
Many big firms, such as Google and Facebook, have told their staff to remain at home until 2021, but that doesn’t appear to have an effect on Cornwall Insight’s forecast for the remainder of 2020’s energy usage. The research firm believes that energy levels will now remain much closer to levels seen in 2019, although does warn that further lockdown measures and changes in economic output could lead to that not being the case.
James Brabben, wholesale manager at Cornwall Insight, commented,“The rise in demand can be directly linked to the relaxing of lockdown measures and businesses starting to reopen. The warm weather spell in early August can explain some of the recent rise as this will have likely caused a higher demand for air conditioning and cooling. However, there is a clear overall trend of demand recovery from the previous lows experienced in the GB market.
“There are concerns over the future economic performance, and the future trajectory of electricity demand will depend largely on how the economy returns to “normal” after the summer holiday season.
“However, Cornwall Insight expects demand for the rest of this financial year to be closer to FY19-20. This is due to the return of pupils to school and of some parents to work environments. Even if many employees choose to work from home, our modelling suggests that demand may be boosted further by workers not returning to office environments. This is because lighting and heating used in households are typically far less efficient than in businesses.
“While the outlook for demand may be more positive than three months prior, hanging over this assumption is the considerable uncertainty of further nationwide lockdown measures. Such an event this winter would again have a material impact on the market, and despite our better understanding of the impacts would remain difficult to hedge and manage for market participants.”