Degree Days Helps Utilities Prepare For Energy Demand

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During the winter most utilities are worried about outages due to a destructive weather trifecta of extreme cold, heavy precipitation and strong winds, such as the one expected to hit the Northeast this weekend. Utilities in the South are especially vulnerable to these conditions because they are not considered “normal winter conditions” in a typical season. But as we have all recently learned, winter weather is not behaving “normal.” A recent McKinsey report estimates that losses related to extreme weather events will increase by 23% for U.S. utility companies by 2050. 

And it is not just cold that threatens to take a grid down. Arizona is worried about a massive grid failure due to extreme heat and has begun developing resilience hubs when needed. In both extreme scenarios, it is the surge in high demand that leads to the large outages in the region, and we have all seen the ramifications of extreme weather among multiple energy sources when the demand is especially high.

Weather analytics plays a significant role in helping utilities prepare for load, or energy demand, forecasting using degree days. According to the U.S. Energy Information Administration, degree days are “measures of how cold or warm a location is” using the mean outdoor temperature compared to a standard, or base, temperature. Heating degree days are a measure of how cold the temperature was on a given day or during a period of days. Cooling degree days are the measure of how hot the temperature was on a given day or during a period of days.

Base temperatures are set by the temperature that a building would need to be heated or cooled and vary by country or region. For example, the base temperature in Europe is 59.9 Fahrenheit, while the U.S. base temperature is 65 Fahrenheit. Other variables come into play to calculate degree days such as the population of a region to estimate energy consumption, and of course, there is granular bias that can’t be accounted for such as the construction and age of the building or orientation relative to other structures. For this reason, The National Oceanic and Atmospheric Administration reports heating and cooling degree days at the local, state, regional, and national levels.  Private weather companies work with utilities further by integrating temperature forecasts and degree day information into integrated energy demand algorithms.  These insights allow utilities to anticipate changes to power loads and compensate by having enough energy available to meet the heating or cooling demand.

The Northeast is likely to see another major storm this weekend, with the potential for heavy snow and blizzard conditions in the North from Washington, D.C., to New England and snow and ice farther south in Virginia and the Carolinas. This comes after many in the region experienced outages after a winter storm in early January.  And while the impending winter storm, including an expected bomb cyclone, is not unusual for the Northeast, EPA historical data shows that the trends for heating and cooling days are shifting. In the past 25 years heating degree days have generally decreased and cooling degree days have generally increased throughout the North and West. The Southeast has seen the opposite: more heating degree days and fewer cooling degree days. This historical insight, along with short-term forecasts tailored to geography and population, is one way that weather analytics can help utilities meet customer demand and keep the power going regardless of the temperature.

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