Generation from renewable energy resources will continue to outstrip generation from fossil fuel plants, according to the latest data from the Energy Information Administration (EIA).
Increased power generation from new renewables capacity, mostly wind and solar power, will reduce generation from both coal-fired and natural gas-fired power plants in 2023 and 2024, the EIA forecast in its latest Short-Term Energy Outlook (STEO).
With the new solar and wind projects slated to come online this year, renewable resources will account for 16 percent of total generation in 2023, up from 14 percent last year and 8 percent in 2018, EIA said.
Renewable resources, especially wind and solar power, have been growing rapidly in the United States. There were about 74 gigawatts (GW) of solar photovoltaic capacity at the end of 2022, which is about three times the capacity at the end of 2017, and U.S. wind power has grown by more than 60 percent since 2017 to about 143 GW, EIA said.
Based on planned additions reported to the EIA, solar capacity is expected to increase by 84 percent with the addition of another 63 GW by the end of 2024, aided by declining solar construction costs and tax credits. With the increase in capacity, the EIA expects solar power’s share of total generation will rise from 3 percent last year to 5 percent in 2023 and 6 percent in 2024.
The growth in wind power installations is slower this year than in recent years, at about 12 GW of new planned capacity over the next two years, EIA noted. Expectations of wind power’s share of total generation in 2023 remains similar to last year, averaging 11 percent for both years, with a 12 percent increase expected in 2024, EIA said.
Much of the growth in solar capacity is occurring in Texas and California, where natural gas has been the primary source of electricity, the EIA said. A growing share of generation from renewables, combined with the agency’s forecast of less overall electricity demand this year, will displace some natural gas generation, which will decline slightly, falling from 39 percent in 2022 to 38 percent this year and to 37 percent in 2024.
The EIA also forecasts a two percentage point decline in the share of generation from coal-fired plants, to 18 percent, this year, as lower natural gas costs make coal less competitive. The EIA expects coal generation to fall again in 2024 to 17 percent of total generation.