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Powering Tomorrow > Forecasting electricity demand in a time of uncertainty

June 01, 2020  |  Data

Forecasting electricity demand in a time of uncertainty

Over the last few months, Ontarians have worked together to adjust to the new realities brought forth by the COVID-19 pandemic. At the IESO, we have been working closely with partners and stakeholders to ensure the continued reliability of the grid, so that electricity continues to be there when and where it is needed.

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While IESO operators ensure that the electricity grid remains reliable, planners and forecasters have been monitoring the impacts of the pandemic on the power system. What we learn today will help us forecast and plan for future near, medium and long-term needs, which have now shifted from what our original forecasts anticipated.

As non-essential businesses closed and most Ontarians stayed home, demand forecasters began adjusting their focus to how these changes would reflect on the electricity system. Provincial demand began to take a different profile as the month of March closed out. The graph below shows a comparison of hourly demand between March and April compared to similar days in previous years showing just how much demand has changed.

Graph depicting reductions in hourly demand between March 16 and April 17 compared to similar days in previous years

(Graph: Reductions in hourly demand between March 16 and April 17 compared to similar days in previous years)

For similar day comparisons, system planners look at days of the week, weather and embedded generation output. Based on this analysis, demand has been 6 to 18 per cent lower than you would normally expect.   

“These reductions reflect increases in some customer segments and decreases in others.” says Kausar Ashraf, manager of demand and conservation planning. “There has been an increase in residential demand as residents stay at home, while, commercial demand has seen significant decreases, as businesses closed in order to comply with provincial orders”.

Although the system has reached a steady state, demand is expected to continue to change as summer and warmer weather materializes, and as the province moves towards the re-opening of the economy. As the province settles into the new demand normal, system planners, assess how things might change in the medium and long-term. The conditions that we are seeing today, are not the conditions that we will see tomorrow or down the line.

Previously, Kausar and her team had a better picture of what demand would be on a given day “I used to be able to tell you what demand would be if it was a sunny Wednesday in April. As a planner we are trying to understand, model and predict how everyone uses electricity based on the various factors that impact demand, like weather. Right now, we’re trying to navigate how and when things will change as the province’s pandemic response evolves.”  

To help navigate the uncertainties brought upon by COVID-19, system planners forecast scenarios for the future. There are many factors that influence demand, weather typically being the largest influencer. However, during this time of economic uncertainty, economic outlooks will play an important role in developing future demand and supply scenarios.

The IESO’s outlook for demand over the next five years will be driven by the depth and duration of the pandemic response measures and economic impacts to the economy. To understand what may lie ahead, planners turn to the past by studying how the electricity system reacted to previous economic events such as the 1990 and 2008 recessions. What planners have observed is that GDP and energy demand are not a tightly correlated relationship, demand does not bounce back at the same pace as the economy.  

The pandemic also has the potential to impact plans being undertaken by Ontario’s generating fleet and transmitters. Nuclear refurbishment schedules may be impacted, transmission development are also expected to experience delays, and other generators may experience difficulty completing maintenance due to workforce limitations, which may lead to higher-forced outage rates in the future.

Working closely with stakeholders will aid in navigating these uncertainties. The IESO continues to work closely with market participants to understand how the pandemic is affecting their operations and how these impacts will be reflected on the system today and tomorrow. Our forecasts are used by market participants to advise their business decisions, help plan equipment outages, and coordinate maintenance plans for generation and transmission equipment. Keeping open and transparent lines of communications is crucial to maintaining the reliability of the gird, under any scenario.

As we move forward, planners and forecasters are working on updating outlooks to provide clarity on where the electricity system is headed. The recently released interim Reliability outlook includes revisions to the demand forecast to account for the impacts of COVID-19 on electricity demand. The next 18-month Reliability Outlook is due to be released at the end of June; the outlook will help inform system operations and outage management over the next 18 months.

As we navigate the new realities of the pandemic, and the impacts it has on our lives, the IESO will continue to look ahead to ensure that despite the changes that are taking place and the ones that are to come, Ontarians can count on a cost-effective, reliable electricity system.

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