IEEFA Energy Finance 2016: “It’s No Longer ‘Someday We’ll Have Renewables,’ It’s Here”

“Continuing declines in energy market prices will dramatically increase competitions from wind and solar, which means increased risk for coal-fired plans under capacity performance plans.”

That’s David Schlissel of IEEFA at an Energy Finance 2016 session today explaining regional trends in electricity-generation markets nationally, noting how utility companies in West Virginia and Ohio are frantically seeking ratepayer bailouts for coal-fired plants that have becoming increasingly uncompetitive.

Schlissel, director of resource planning analysis at IEEFA, said “energy market prices are going to be really low for a really long time, which is about the worst possible for coal plants.”

The coal-industry takeaway: “Low energy market prices mean reduced revenues and lower profits … this has led and will continue to lead to coal plant retirements and reduced generation at those plants.”

Schlissel noted the rise of renewables—wind in particular—in several U.S. electricity markets including PJM Interconnection, which serves all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia.

“Gas, wind and solar are dramatically replacing coal in PJM,” he said. “More renewables are on the way. It’s no longer ‘someday we’ll have renewables,’ it’s here.”

Schlissel also noted the dramatic rise of wind-powered generation by ERCOT, the Electricity Reliability Council of Texas, which serves most of that state.

“Wind provided 18.4 percent of energy in ERCOT in November 2015 … that’s almost a fifth, pretty impressive,” he said, noting that ERCOT’s coverage map includes Austin, Dallas, Houston and San Antonio. “We’re not talking Montana. It’s a lot of cities.

Schissel said also that solar is gaining ground in ERCOT, albeit at a slower pace than wind.