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Published on July 5th, 2016 | by Christopher Arcus

17

EIA Growth Projections Confound

July 5th, 2016 by  


EIA continues to project conservative renewable growth. The authoritatively viewed administration just can’t seem to get it right. It continues the confusion of policy-based growth, assuming renewables growth lags once subsidies end (after 2020). The EIA just doesn’t seem to get that the market is dynamic and interactive. Its approach is too static, and it seems to ignore trends like the falling prices of solar and wind compared to other sources.

Solar-and-Wind-Price-Reduction-2009-2014-Lazard-With-National-Grid-Costs3

Image by Lazard & Ramez Naam

electricity generation forecast

EIA renewable forecasts

EIA electricity forecast

Those curves make little sense. One simple check of accuracy is discontinuity. Take a look at the graph of annual electricity by source, for example:

electricity generation forecast

It is very unlikely that a curve starting from today will make a slope breakpoint starting tomorrow. Any graph that shows breakpoints should be regarded with suspicion.

 The graph shows coal in a slide until today, and suddenly flattens its fall starting tomorrow and for the next 2 years, only slowly declining after that. That is unlikely.

 Likewise, it shows natural gas on a fast upward slope, suddenly decline until after 2020. 

Meanwhile, renewables grow quickly to 2020, and then that growth slows dramatically, only growing 50% in the next 20 years.

Meanwhile, nuclear remains flat, with prospects for growth looking dim. We have recently lost more reactors than we are building. With the average age of reactors over 30 years, it would take a rapid build cycle to replace older reactors.

 That seems highly unlikely.

nuclear growth trend

Looks like the EIA decided that the renewables tax extensions would boost development for that period and renewables could not grow for the following 20 years without them. Further, it looks like the organization judged that renewables would not reduce coal, but would compete with gas. There is no justification for this.

Let’s try this instead:

Wind continues to grow at a 5-year doubling rate, about 14%, or double-digit annual growth. Look for other states besides Texas to get much more serious. Think Kansas, Oklahoma, Nebraska, and the Dakotas. Montana and Wyoming are also potentially big. The expansion of wind to the eastern states continues with tall towers, and offshore starts off the East Coast and in the Great Lakes. Capacity factor rises in all locations.

Solar continues its meteoric rise, doubling every 2 years, with California, Texas, New Mexico, and yes, even Nevada leading the way. By 2025, solar is up there with wind in capacity, but lags a bit in electricity generation due to wind’s increased capacity factor. CSP with thermal starts to come on strong as 24/7 and nighttime demand becomes a lucrative market. Energy markets switch to valuing nighttime electricity equal to daytime as solar provides adequately for daytime needs, especially in summer. Solar and wind become major percentages of electricity generation. At the same time, there are millions of electric vehicles opportunity charging, and also V2G — during the day at work, at shopping malls, and at night at home. The V2G storage provides a huge buffer for demand variation, and the demand curve changes and becomes more adaptable as demand management becomes pervasive.

Nuclear continues its slide, as new reactors are shunned by private financing and government interest wanes while it becomes apparent nuclear is a losing cause — purely on a financial basis.

Coal dwindles as natural gas capacity rises, but generation pauses as renewables reduce fuel demand.

Too bad EIA can’t run the numbers with ideas like that. Then it might have something. 

EIA’s conservative numbers are an old story. They are getting better, but not enough.

2016-06-07_IEEFA-Feaster-Coal-v-renewables-March-2016

Looking forward to the near future, we can glean some numbers. Continuing the IEEFA graph, what do we see by 2020? Coal has fallen at least 10% in the last 5 years, and I think it’s reasonable to expect that coal will fall to around 20% in the next 5 years. Meanwhile, new renewable capacity has exceeded all other sources combined and looks set to gain more of new capacity every year going forward. Almost all new capacity is renewables and natural gas. We can expect the total added capacity to be about the same for each, with a little more added for renewables than natural gas. (And that is perhaps being generous to natural gas.) 

Note that renewables were the largest source of new capacity globally in 2013 and ever since.

Clean Energy Growth

renewable capacity 2015

New electricity capacity globally in 2013 and 2015, respectively. Images and data by Bloomberg New Energy Finance

With wind doubling in the US every 5 years and solar every 2, by the end of the next 10 years, wind power could be 4x today’s total, while solar could be 16x today’s total, erasing the 4x spread between them and leaving us with equal amounts from both by 2026. With US wind capacity at 75 GW and generation at 181 TWh, or 4.44% of all electric generation, those numbers would rise accordingly in 10 years as well. If growth continues at those rates, we would see about 30% wind and solar in the next 10 years, exceeding the EIA numbers.





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About the Author

has studied wind, electric vehicles, and environmental issues. An electrical engineer familiar with power and electronics, he has participated in the Automotive X Prize contest. He is an avid writer, specializing in electric vehicles, batteries, and wind energy.



  • Frank

    This is what EIA has to say on the subject. http://www.eia.gov/todayinenergy/detail.cfm?id=25512

  • neroden

    Extend those 2026 projections (30% wind+solar in 2026) by four more years, and you get 100% wind+solar in 2030. (We’ll keep our 6% hydropower, though.)

    Well before that, the main issue will be having enough batteries (and quite possibly transmission) to supply nighttime demand. I’d like to see some scenarios on that.

    • eveee

      At that point (over 70%) saturation effects become a possibility. It’s always the last 10% that takes the most time. In reality, 100% is not realistic. Someone will be running a generator somewhere. It matters little. Even a small improvement in deforestation can swamp that effect.

  • JamesWimberley

    A possible explanation, if not a defence, for the EIA’s blinkers is American exceptionalism. They are under the illusion that the American market, and hence American policy, determine the course of prices of wind and solar energy. I don’t have the US shares of the world markets to hand, but they must be under 20%. It would be less inaccurate to assume the opposite, that the USA has no more influence on world prices than Zimbabwe.

    • Mike Shurtleff

      Also, even the USA is right now transitioning to purely market driven economics for adoption of Wind and Solar PV. I would argue Wind is already there in the US and Solar PV is right behind it. If Trump or Cruz gets elected and steps on Wind and Solar PV growth, then that could temporarily slow things down. Not for long though. Prices would drop, demand would rise, and off we go again.
      Globally, we have already passed on to market driven Wind and Solar PV adoption in a number of areas. …and their cost is still dropping. This includes the State of Hawaii in the US. California is not far behind.
      2016 will be interesting.

      • neroden

        Given that the main thing preventing rooftop solar from being market-price-competitive in the US is *installer profits and installer marketing costs*, it really shouldn’t be hard to make that transition….

        Just have to find an installer who figures out that they should cut costs to the bone in order to attract customers based on price, rather than spending money on marketing.

  • Timothy A Clawson

    The EIA is completely clueless on what will happen in the future. But I don’t have a crystal ball either, so I can’t predict how big renewable energy will be in 10, 20, 50 years in the future. The renewables are under constant attack from incumbent fossil fuel and utility companies with changes in net metering, feed in tariffs and cuts in federal subsidies. So it is very difficult to predict how big renewables will be in the future.

    • Julian Cox

      Good article to call out this issue. The same applies to numerous government agencies that seem to simply aggregate the opinions held by large industry.

      For example the progress of automotive traction battery price and performance is aggregated from belligerent know-nothings like GM and Ford while the company actually setting the pace of the trend and with the world’s highest KWH volume of vehicle traction batteries, also a US company, is not even consulted.

      Wouldn’t it be nice if Obama’s #ActOnClimate actually reached at least as far as acting on government agencies. Even the EPA is guilty of pedalling aggregated misinformation supplied by fracking industries regards fracking emissions. Never mind the fact that the EPA is banned from regulating groundwater toxicity from fracking even where drinking water is at risk.

    • Mike Shurtleff

      “I can’t predict how big renewable energy will be in 10, 20, 50 years in the future.”
      No, but anyone with half a brain can predict Wind and Solar PV will be producing the lion’s share of our energy in the future. Wind is now the lowest cost source of new electricity for the grid. ThinFilm Utility scale Solar PV is the second lowest in the USA. Both are still dropping in cost. Majority use of Wind and Solar PV seems impossible to some, but it is clearly what is coming.
      …barring some other unlikely new breakthrough in low cost energy production.
      You cannot predict the future by assuming it will look the same as today.

      • neroden

        Solar installations have been doubling every two years for *decades*. There’s no reason to expect this trend to stop in the near future. It’ll stop when the US electricity market is *completely saturated* with solar power, and not before. (The world market will probably slow down before total saturation, but the world market won’t be anywhere near saturation by 2030 when the US will be saturated.)

        • Calamity_Jean

          “Solar installations have been doubling every two years for *decades*. There’s no reason to expect this trend to stop in the near future.”

          I wouldn’t be surprised if the rate of solar installation accelerates. Based on the fall in price for solar PV, the Texas grid operator expects that nearly all of the state’s coal plants will shut down and be replaced by solar power. Link: http://blog.ucsusa.org/mike-jacobs/texas-solar-power-plants The same trend will no doubt spread west, east and north from Texas, especially if natural gas prices creep up even a little bit.

          • Bob_Wallace

            Doubling will stop. Doubling is something that can happen only when the base number is low. But I do see further acceleration. We are, I suspect, only at the threshold of solar installation globally.

            And there’s a kicker coming. Look for EV sales to take off by 2020. That’s new demand. Utilities are going to look at the need for more capacity and solar and wind are going to be the two least expensive ways to create that new capacity.

            If, at the same time, someone comes up with a good solution to let EVs become opportunistic chargers then it will be a no-brainer.

  • Harry Johnson

    Thankfully, dirty coal is now dying. And nuclear is too expensive to meter.
    The real wild card here is natural gas which has been key to replacing dirty coal. But about two thirds of our natural gas currently comes from fracking. What happens when we realize that fracking has been nearly as bad as coal? Fracking is booming all around the world and even offshore where oversight is nearly impossible.
    Methane leaks always end up being much worse than we thought and the world could be headed for a very fast warm up because of fracking.

    • “nuclear is too expensive to meter”
      — haha, love that 😀

      and, incidentally, that’s the next article come from Chris….

    • Mike Shurtleff

      “nuclear is too expensive to meter”
      Loved that line as well!

      Sure, NG has been displacing most of the coal, but that is changing. More new energy is now coming from Wind and Solar PV than from NG, as shown above. You can see this happening in the changing bar graph here:
      http://cleantechnica.com/2015/11/05/graph-of-the-day-watch-us-electricity-grid-evolve-before-your-eyes/
      Hard to see, but keep your eye on the amount of yellow from about 2010 on.

    • Karl the brewer

      “And nuclear is too expensive to meter”.That is a slogan worthy of a T shirt at the very minimum. If i could give you 1000 upvotes i would.

    • Brunel

      The solution is UHVDC lines from CA to east coast.

      So that a few gas power stations can be replaced by solar power.

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