For a self-proclaimed champion of the US coal industry, President* Trump sure has some ‘splaining to do. A temporary uptick in production has not stopped a generations-long skid in coal employment, and a new federal report provides more evidence that coal’s most stalwart customer — power generation — will continue to bow out of the scene in favor of natural gas and renewable energy.
Good-Bye, Coal, Hello Natural Gas…
The new report is the latest Energy Infrastructure Update from the Federal Energy Regulatory Commission. Issued on January 3 for November 2017, it covers generation units with a capacity of 1 megawatts (MW) or more. It’s packed full of good news for natural gas and renewables, but not for coal.
Within the next three years (by December 2020), FERC anticipates the retirement of 74 coal power generation units with an installed capacity of 20,650 MW.
That doesn’t look so good compared to additions, which total only 1,927 MW spread out among just four units.
In contrast, natural gas is looking at the retirement of 118 units totaling 10,803 MW, but it’s also adding 387 units with a total of 92,489 units.
The upshot is a stunning loss of status for coal. Just a few years ago, coal accounted for a full 50% of US power generation capacity. As of November 2017 it stood at 23.83%.
For the record, natural gas clocked in at 43.36% in November 2017.
…Hellooooo Renewable Energy
Natural gas might not hold its lead position much longer. Renewable energy — wind, solar, hydro, biomass and a smattering of geothermal — is already creeping up on coal at a combined 19.92%, and low cost wind and solar are beginning to edge out natural gas in some markets.
On the renewable energy side, the most dramatic story in the FERC report is wind capacity. That sector registers only two retirements totaling 68 MW, but FERC foresees 465 additions totaling 72,526 MW.
Subtracting retirements from additions, that brings wind closer to the range of natural gas, at 72,458 MW for wind compared to 81,686 for gas.
Solar also turns in a strong performance, with a total of 43,528 MW in additions compared to only 2 MW in retirements.
That’s a pretty respectable number, considering that many solar installations in the US are less than 1 MW and are not included in the FERC report.
On the downside, SEIA and other solar energy stakeholders are concerned about the looming threat of new tariffs under the Trump administration. Prices for solar panels are already rising in anticipation of a sharp tariff-related spike to come. According to SEIA, uncertainty over the tariff has already contributed to a slowdown in the growth rate of residential solar installations.
Nevertheless, SEIA foresees a bright spot in non-residential solar energy, fueled by surging demand for community solar projects as well as continued demand among major US companies including early adopter Walmart among many others.
In support of growing the non-residential market for PV, SEIA has just issued a new model contract for commercial and industrial properties that combines the benefits of power purchase agreements with the potential for local financing through property tax assessments (the PACE) program.
SEIA has also just issued a new white paper outlining the benefits of solar installations for property owners, including lower energy costs, higher rents, and lower vacancy rates.
A Tip Of The Solar Iceberg
Tariff or no tariff, another potential area of domestic solar growth is concentrating solar power, which relies on heliostats (specialized mirrors) or troughs instead of PV panels.
The thermal storage element of concentrating solar power allows for some interesting applications beyond electricity generation. For example, the US Department of Energy is especially interested in deploying CSP to generate steam for various food processing steps including pasteurizing and blanching.
The agency is also exploring high-heat CSP to “split” water for renewable hydrogen (the conventional source of choice for hydrogen is natural gas).
During the Obama administration the Department of Energy championed CSP as the wave of the future. Despite Trump’s happy talk about coal, as recently as last November the agency was still making a strong case for CSP as a reliable “baseload” source of electricity — in other words, making the case for solar energy to push coal and nuclear out of the picture.
For that matter, the Energy department has also continued to promote small-scale residential solar energy installations.
Shhhh! Don’t tell the President!
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Image: Crescent Dunes CSP via US Department of Energy.