The share of US electricity from renewables will grow this year at a slightly slower rate than previously expected, partly because of lower costs for natural gas-fired generation, according to the US Energy Information Administration (EIA).
Renewable resources are expected to account for 23pc of US generation this year and 26pc next year, up from 22pc in 2022, EIA said today in its latest Short-Term Energy Outlook. While the projection for 2024 is unchanged, the agency last month had predicted renewables this year would account for 24pc of US generation.
Renewables included in the agency's outlook include conventional hydropower, wind, solar facilities larger than 1MW, geothermal, and certain forms of biomass. Collectively, those resources will supply the US grid with 941.5mn MWh in 2023 and almost 1.05bn MWh in 2024. The figures mark a 1.6pc decrease and 0.5pc increase, respectively, from EIA's previous outlook.
The dip in 2023 renewable expectations accompanies a slightly higher projection for natural gas-fired generation in the overall US mix, which EIA now estimates will rise to 40pc this year, up from 39pc last year. The agency last month predicted natural gas would provide 39pc of US generation this year and attributed today's revision to a "significant decline in fuel costs."
Natural gas-fired generation will decline to 38pc of the US mix next year as a consequence of higher fuel costs and the increasing availability of renewables, EIA said.
Regionally, the picture varies a bit. For the ISO-New England territory, non-hydro renewables will provide 12.5mn MWh this year, rather than 12.1mn MWh as forecast in April. EIA expects non-hydro renewables to provide 12.6pc of the region's overall power mix this year, up from the previous forecast of 12.1pc, due to a decline in anticipated total generation.
EIA's outlook for non-hydro renewables next year remains at 14.4mn MWh.
Spanish utility Iberdrola expects to commission its 800MW Vineyard Wind I project this year, making 2024 its first full year of service for the New England grid. States across New England, which has limited space for new onshore facilities, are expecting offshore wind generation to meet an increasing demand for carbon-free electricity as renewable portfolio standard targets ramp up.
In the territory overseen by the PJM Interconnection — largely the US mid-Atlantic states — EIA lifted its 2023 and 2024 projections for non-hydro renewables by about 1.2pc and 0.5pc, respectively, to 51.5mn MWh this year and 61.6mn MWh next year. But EIA now expects PJM generation this year to total 807.2mn MWh, up from 782.2mn MWh in last month's outlook. As a result, renewables will provide a smaller percentage of the region's overall generation despite higher expectations for generation from resources like wind and solar.
In the Electric Reliability Council of Texas (ERCOT) area, which covers roughly 90pc of the state's electricity load, generation from non-hydro renewables is expected to total 147.8mn MWh and 177.1mn MWh in 2023 and 2024, with the latest figures marking a reduction of 1.5pc and increase of 0.2pc, respectively, from last month's forecast.
Texas lawmakers are taking steps to reduce state support for renewable energy in favor of dispatchable generation like natural gas-fired power plants. The legislature is mulling a proposal that would require 50pc of all new generation on the ERCOT grid to come from dispatchable sources beginning in 2024. The state House of Representatives still must approve the legislation before it would go to governor Greg Abbott (R).
