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New York — US power demand growth of 3.7% in 2018 was largely driven by an uncommon confluence of increased heating and cooling degree days, which were at their highest combined level since the 1950s, BP's group chief economist, Spencer Dale, said Wednesday in New York.

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The big outlier relative to normal global energy demand growth was in the US last year where demand grew by 3.5%, Dale said at an event hosted by Columbia University's Center on Global Energy Policy to introduce BP's 2019 Statistical Review of World Energy.

The "extraordinarily strong growth," the highest in 30 years, was driven by demand for all fuels, but from natural gas in particular, demand for which grew by over 5% in 2018, Dale said.

Gas demand accounted for over 40% of total 2018 US energy consumption, according to the BP data, and "a key factor driving this was weather," Dale said. The number of hot and cold days in 2018 increased and in response families and businesses switched on their air conditioners and heaters more often which drove up demand.

This was particularly pronounced in the US, China and Russia. A chart combing the frequency and intensity of heating and cooling degree days in the US showed a "particularly uncommon" result where both heating and cooling degree days increased, Dale said.

Years in which there were lots of heating days, over the past two or three decades, tended to coincide with relatively low numbers of cooling days or vice versa, but last year they both moved up together, he said.

This "double whammy" of combined heating and cooling days was the highest since the 1950s, Dale said.

"We estimate that about 0.9% of the 3.7% year-over-year load growth in 2018 was due to non-weather factors (i.e. underlying economic/industrial and population growth)," Manan Ahuja, senior director of North America Electric Power at S&P Global Platts Analytics, said in an email.

This was a significant turnaround compared to 2017 when the year-over-year weather-adjusted load growth (decline) was about (- 0.1%), Ahuja said.

"However, the initial readings (first four months) in 2019 are slightly weaker (as compared to 2018 load growth) as we see year-to-date weather-adjusted load growth in the US being close to 0.2% year over year," Ahuja said.

GAS DYNAMICS

"2018 was a bonanza year for natural gas," with gas demand and production globally growing by over 5%, which was some of the strongest growth on the supply or demand side for over 30 years, Dale said, adding that "America was absolutely dominant."

The US accounted for 40% of the growth in demand and over 45% in the growth of production and US gas output growth was the strongest annual increase ever seen by any country.

The US achieved "a unique double first" with the largest annual increase ever seen in both oil and gas production -- 16.6% and 11.5% respectively -- much if it coming from the Marcellus, Haynesville and Permian shale basins, Dale said.

While some of the increased US gas production went to feed LNG exports, the "vast majority" went to satisfy domestic consumption, he said. US gas demand increased by 78 Bcm in 2018, which is equal to the volume of growth from the previous six years combined or the UK's entire annual gas consumption.

The gas demand growth was a weather-driven story led by the increase in heating and cooling days, which increased demand for gas directly for commercial and residential building heating and cooling and indirectly for power generation demand, Dale said.

Power generation accounted for about half the 2018 US gas demand growth.

With regard to addressing climate change by decreasing carbon dioxide emissions from the power sector through increased use of renewable energy, Dale described a challenging situation in which the 2018 share of coal and non-fossil fuels were exactly equal to their levels 20 years ago.

"We have made no progress in terms of improving the fuel mix in the global power sector," Dale said.

Power generation from renewable energy resources grew by about 800 TWh over the past three years, but to keep carbon dioxide emission levels flat would have required an 1,800 TWh increase, he said.

That's a "staggering number" because that incremental 1,000 TWh is equivalent to the entire renewable energy generation of China and the US in 2018, Dale said.

-- Jared Anderson, jared.anderson@spglobal.com

-- Edited by Richard Rubin, newsdesk@spglobal.com