• Energy Research

Covid-19 affects the personal lives of millions and led to an economic crisis. Changed behavioral patterns and a reduction of industrial activity result in a reduction in power demand, and thus Covid-19 impacts the power systems around the world. Bottom-up mapping of the effect of Covid-19 on the energy demand is challenging, if not impossible. In order to analyze the impact of the pandemic on power demand, we instead propose a simplified approach based on an econometric analysis that quantifies the country-wide load reduction of Covid-19, using the number of active cases as well as the specific lockdown period as proxies. The time span covered is from 1 January 2016 to 31 August 2020. This long time span allows us to investigate the effect of Covid-19 on the power demand. We find that in Germany (DE) and Great Britain (GB) the power demand is reduced by about 1–1.7 MW per case, while in France the demand increased by 1 MW per case during times outside of the lockdown. On the other hand, in France the lockdown itself has a much higher load reduction effect in France than in GB and DE. Based on the elasticity of power demand regarding Covid-19 cases, we calculate the impact of Covid-19 on the power prices through reduced loads. We find that Covid-19 reduced power prices by 3 to 6 EUR per MWh. The effect of Covid-19 on carbon emissions in the power sector is likely to be small. In Germany, the country with the highest absolute level, emissions in the power sector were reduced by approximately 2% (4 Mio. t CO2).

In 2019, CO(2) emissions in Germany dropped by 40 Mt compared to the previous year, of which a major share was realized in the power sector. Many factors, such as carbon and fuel prices as well as the capacity expansion of renewable energy sources, influence Germany’s CO(2) emissions. This ex-post regression analysis of the German power market from 2016 to 2019 investigates the contribution of each factor to the CO(2) emissions reduction. The results suggest that short-term market developments for gas prices are responsible for a major share of 2019’s CO(2) emissions reduction when compared to 2018 levels. The sustainable transition of the power system, in form of adequate CO(2) prices and additional renewable energy capacities, becomes the dominating factor when analyzing the CO(2) emissions reductions over the longer time span from 2016 to 2019. Exogenous factors, such as increasing gas prices, could raise Germany’s carbon emissions again. This reversion of carbon emissions reductions can be avoided if the overall-society compromise on the coal phase-out is realized sooner than later.