Revenues in industrial and commercial sectors down four billion and one billion

Electricity’s Revenues Down in 2015

Revenues from sales of electricity were down three billion dollars, nationally, 2015 through November, per the Energy Department.  Unadjusted for inflation.  That’s a decrease of nine tenths of a percent from the prior year.

The prime driver was sales to the industrial sector.  Revenues from industrial companies were down over four billion dollars.  As a percentage, that’s a drop of 6.7 percent.  Not a typo, 6.7 percent!  

The disappearing revenues from industrial companies means that industry now supplies just 17 percent of electricity’s revenues.  Put another way, the total electric bill of the residential sector is now 2.7 times more than the total electric bill of the industrial sector.  The commercial sector is now 2.2 times more.

Revenues from the commercial sector were down by slightly less than a billion dollars.  As a percentage, that’s a drop of 0.7 percent.  

Revenues from the residential sector were up by slightly greater than two billion dollars.  As a percentage, that’s a rise of 1.4 percent.  

Residential sales now account for 46 percent of electricity’s revenues.  From the standpoint of the grid’s financial health, what happens in residential sales (and utility regulation in this area) is becoming ever more crucial.

Flat revenues means Americans are paying less for their electricity in inflation-adjusted terms.  Like what happens when gasoline prices fall or hold steady, this has the effect of increasing our wealth, our ability to spend money on other goods and services.  

The Energy Department releases the December numbers on February 26th.  With the mild December weather, together with a relatively weak economy, look for 2015 to come out even worse or even better depending on your point of view.

We’re not a news service.  We weren’t in 1929 when Public Utilities Fortnightly was founded, and we’re not one now.  So we don’t report the numbers or the events of the day, for the electricity and natural gas utility industries.  

But we do intend to give them a balanced perspective, sans hype or ideology, dissecting where we’re actually heading.

Steve Mitnick, Editor-in-Chief, Public Utilities Fortnightly
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