How COVID-19 stoked electricity demand in residential sector

How COVID-19 stoked electricity demand in residential sector

The outbreak of Covid-19 was initially perceived as mere speculation in the outside world apart from Wuhan in China. People from other parts of the world by December 2019 thought that happenings in Wuhan could be contained and dealt with.

Little did they know that Covid-19 would be knocking at their doorsteps, and would have to go through lockdowns. Reality dawned on most people with the pandemic declaration by the World Health Organization (WHO), whereas the doubters did not believe Covid-19 was that dangerous.

Health care systems of first world nations crumbled and could not contain it. Lives and livelihoods were lost; economies and businesses were brought to their knees whiles human movements were restricted.

The emergency measures that were introduced was for countries, States and communities that were recording upsurge in their figures to be locked down. Land and sea borders were also shut to prevent movement.  Some airports were opened yet with severest of screening and testing for passengers.

The importance of the lockdowns was to slow the contagion as well as reduce peak healthcare demand while protecting the most vulnerable from infection. The lockdown aimed to reverse epidemic growth and reduce case numbers to low levels by social distancing the entire population.

Social gatherings were halted, schools and colleges were closed. The restrictive measures put in place by Governments had law enforcement agencies on alert to compel citizenry to adhere to these measures.

Ghana’s Experience

In Ghana, the first case of Covid-19 was recorded on the 13 March 2020, folloed by sharp rise in the infections, and spreading to other regions of the country. Pressure mounted on Government to lockdown the country, close borders, and institute measures to slow the spread and contain the virus.

As part of measures to contain the virus and halt its spread without jeopardizing the lives of people in Ghana, there were also calls for Government to introduce indefinite closure of universities, schools, churches, mosques, and a ban on all public gatherings.

President Nana Addo Danquah Akuffo-Addo as a result imposed partial lockdown restrictions on regions like Greater Accra, Greater Kumasi as well as the densely populated town of Kasoa in the Central Region of Ghana on 27 March 2020, after they emerged as hotspots for the spread of Covid-19. This action was supported by the Imposition of Restrictions Act (2020) Act 1012.

Prior to that, the President had on 21 March 2020 ordered the closure of all the country’s borders (land, sea, and air) to all human traffic and directed a 14–day mandatory quarantine and testing for all travellers (Ghanaians or residents) from countries with more than 200 Covid-19 cases.

There was also closure of beaches across the country as announced by the Ministry of Tourism in March 2020. Periodic press briefings by the Ministry of Information (MoI) were held during the initial part of the pandemic to update the public on the situation at hand.

Additionally, education materials printed in different languages were given out to educate the public on social distancing, regular washing of the hand under running water using soap and compulsory wearing of nose masks. Regular adverts on both print and online media were also undertaken to sensitize the population.

As in most part of the globe, the containment measures instituted in Ghana, severely affected the economic well-being of Ghanaians, particularly those within the lockdown zones. Within a short time, the negative effects rippled across the country to include rural areas and in less-developed central and northern part of the country, where poverty is high.

In response to the economic challenges, Government introduced various intervention measures to support those affected. These measures had included several months of free water to public utilities customers to ensure the compliance of regular washing of the hand under running water. Additionally, hot meals to people living in the most affected areas, particularly Greater Accra and Greater Kumasi, were offered.

Among the relief measures were the introduction of free electricity for lifeline consumers to lessen the burden on them because of the restriction on movement, and a 50 percent waiver on electricity consumption for residents who consume more than 50 kilowatt-hour (kWh) from the months of April to June 2020.

Impact on Electricity Demand

According to the International Energy Agency (IEA), electricity demand in early 2020 dropped quickly across Europe and India with the confinement measures, with dramatic reductions in services and industry only partially offset by higher residential use. IEA further estimated that energy consumption had fallen by up to 20 percent for each month of the national lockdown.

It was also discovered that energy consumption during the initial lockdown had fallen by at least 15 percent in France, Spain, while in Italy, at the height of the outbreak, electricity demand had sometimes fallen to 75 percent. In spite of the cumulative declines in electricity demand, household electricity consumption had increased by roughly 40 percent globally.

In Ghana, a study conducted by the Institute for Energy Security (IES) revealed that the Covid-19 pandemic spurred electricity consumption growth within the residential sector, during the lockdown period, which occurred between end March and end June 2020. This occurred despite total demand dipping during the three-week partial lockdown, owing to reduced activities in the industrial and service sectors.

Generally, electricity consumption in Northern Ghana across all sectors was noted to have increased by 9 percent between March and June 2020 when the lockdown was imposed. However, residential sector’s consumption grew by 13 percent from March to June 2020 against the forecasted growth rate of 5.3 percent. Meanwhile, consumption in the industrial sector recorded an insignificant change.

In Southern Ghana, the general electricity consumption between March and June 2020 was found to have grown by 5.3 percent. Residential consumption in 2020 however increased by 10 percent over the period, although it had decreased by 1.3 percent a year earlier within same period.

Cumulatively, between March and June 2020 electricity consumption in the residential sector surged by 6.03 percent, compared to a 2.03 percent decline over the same period in 2019.

Relative to the industrial and service sectors, manufacturing practices limited to those involved in non-food areas led to a reduction in electricity use within the industrial sector, while the fall in commercial sector electricity usage was triggered mainly by a downsizing of trading services to essentials.

Consumption reduced significantly by 3.3 percent and 6.9 percent for Special Load Tariff Low Voltage (SLT-LV) and Special Load Tariff High Voltage (SLT-HV) customers respectively, over the lockdown period when all non-food related industries were compelled to either shut or slow down operations, compared to lesser drops over same period in 2019.

For medium voltage (SLT-MV) customers, which partly constitutes essentials producing, processing, and supplying companies, consumption during the lockdown period increased by 4.6 percent, compared to a growth of 1.8 percent between the months of March and June 2019.

Overall, the study found that though the Covid-19 lockdown did have a significant impact on electricity demand in the industrial and the service sectors during the lockdown, the significant increase in residential energy consumption offset the huge decline in the former to produce a net growth of 1.6 percent across all the sectors.

Customer Class March – June Cumulative Average Growth Rate (%)
2020 2019
Residential 6.03 -2.03
Non-residential 1.19 -1.20
SLT-LV -3.30 -3.00
SLT-MV 4.58 1.76
SLT-HV -6.92 -2.60
Total 1.58 -7.07
IES 2021 Construct with EC Data

Social adjustments during the lockdown, and government’s reliefs for electricity consumers amid the economic slowdown from the pandemic, were identified by the IES as contributing factors for the huge jump in electricity demand by the residential sector.

As the pattern of psychosocial lives shifted in response to COVID-19 containment initiatives, the country’s energy profiles shifted from industries and commerce, in favour of residential sector, as most people were forced to stay at home. Over the period, there were increased use of home appliances as some students and working professionals resorted to virtual learning and working, using computers, printers, and mobile phones et cetera.

Employees working from home with increased video conferencing sessions such as Zoom and Microsoft Teams also made greater use of cooling and lighting systems. Increased cooking, home laundry, water heating, gaming, and television use from homes during the lockdown led to increased electricity consumption.

Additionally, the free electricity offered to consumers as a relief measure upped consumption so high over the periods that government granted the electricity reliefs. The free electricity offered led to the misuse of electricity in the residential sector and provided the incentive for extended use, because customers knew they have either less or no bills to pay.

Going Forward

The havoc wrought by Covid-19 on national economies has been very damaging. It will take deliberate, pragmatic, and systematic steps by Governments to restore economies on the path of sustainable growth and development.

Going forward, the Industrial and Service sector of the economy should be developed and safeguarded so they could withstand shocks, in the event of another wave of the Covid-19 crisis, or any other pandemic.  It is important to direct attention to these sectors because no economy can grow with the residential consumption of power being the highest, among the rest.

Demand side management (DSM) should equally be treated as key, with the introduction of energy efficiency measures for the citizenry, offices and industrial buildings managers. The population should in fact, be educated on energy conservation and adopt changes in lifestyles that will reduce the wasteful consumption of power.

Xatse Derick Emmanuel has a Masters degree in Economics and is a research and Policy Analyst at Institute for Energy Security (IES).

Kojo Dzigbordi Adjaley is a Professional member of Institute for Energy Security (IES) and works as an Electrical Engineer at the Ghana Grid Company Limited (GRIDCO).

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