According to the most recent update of the Department of Energy?s short-term energy outlook, electricity demand growth is not expected to be immune to the downward shift in heating demand seen so far in 1997. From an annual growth rate of 2.4 percent in 1996, rates of 1.3 percent this year and 1.9 percent in 1998 are projected, assuming average weather conditions and base case economic growth.
Normal weather for the rest of 1997 should result in annual residential electricity demand growth of less than 1 percent this year, down from the estimated 3.4 percent advance seen in 1996. A similar but somewhat less marked effect is expected for commercial demand.
A surge in manufacturing output in the United States this year should pull industrial electricity out of the anemic growth pattern seen in 1996 (estimated at only 0.3 percent), but growth in industrial electricity demand of much more than 1 percent over the next two years seems unlikely. Normal weather in 1998 implies some acceleration of total electricity demand next year, but, at this point, the rate seems unlikely to surpass or even match the overall growth rate in the economy.