March 7, 2018 Read More →

U.S. Energy Agency Sees Long-Term Market Gains for Renewables

Utility Dive:

While natural gas grows the most on an absolute basis in EIA’s projections, nonhydroelectric renewable energy grows the most on a percentage basis.

EIA’s projections have natural gas’s share of generation steadily increasing market share relative to coal through 2050.

Renewable generation, on the other hand, more than doubles between 2017 and 2050, with an average annual growth rate of 2.8%. EIA projections see 80 GW of new wind and solar photovoltaic capacity being added between 2018 and 2021, spurred by declining capital costs and the availability of tax credits.

The addition of new wind farms is expected to continue, but at a slower pace after the expiration of production tax credits in the early 2020s. Although the investment tax credit for residential solar power expires and for commercial solar is reduced in that same time frame, EIA projects solar power growth will continue through 2050 for both the utility scale and small scale applications.

Between 2020 and 2050, the EIA estimates utility-scale wind capacity will grow by 20 GW, and utility-scale solar PV capacity will grow by 127 GW. Over this same period, the EIA projects utility-scale storage capacity will grow by 34 GW, driven by continued cost declines, policies such as storage mandates in California and market participation rules in the PJM Interconnection, and a need to integrate intermittent resources into the grid.

Coal-fired generation, however, does not fare as well in EIA’s outlook. The agency projects coal capacity decreasing by another 65 GW between 2017 and 2030 in the face of continued competition from low gas prices and the increasing penetration of renewables. EIA sees coal generation leveling off at about 190 GW through 2050. Tied to the decline in coal generation, the EIA projects coal production declining from 784 million short tons in 2017 to 699 million short tons in 2022.

Nuclear generation also declines in EIA’s projection, dropping to 79 GW in 2050 from 99 GW in 2017.

More: EIA: Low prices, rising production to boost gas generation through 2050

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