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Hidden in plain sight: EIA highlights massive swing to renewables June 27, 2014

Posted by Maury Markowitz in power grid, solar.
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For many years the gold standard in energy reporting in the US has been the various EIA reports. Over the last five years though, it was clear something was going wrong. Renewables were part of the reports but always listed at high costs and low adoption rates. The numbers weren’t wrong, just outdated, as if you were reading a report from three years ago.

And this month’s report drives that home; the EIA has been predicting slow uptake of various renewables for some time now, and long predicted that it would reach about 13.5% of the electrical mix around 2040. However, the latest report, covering the first third of 2014, shows that renewables covered 14.04% of the electrical mix.

Wow.

So here’s the big point right off the bat: the output of renewables grew 4.36% compared to the same period last year. Think about that for a moment, this illustrates a significant underlying change to the grid mixture, one that’s occurring at rates not seen since the heyday of nuclear in the late 1960s.

Now another interesting fact in that same number is that hydro didn’t represent much of that uptick. That shouldn’t be surprising; hydro plants have long lead times so they tend to show up in stats like these in sudden one-off bumps.

Which brings us to interesting fact number two; for the first time, hydro produced less power than other renewables. During the four month period, non-hydro resources accounted for 52.7% of the mix, hydro the other 47.3%.

Wind produced more than 5% of all the electrical power in the US for the  first time. It remains one of the fastest growing sources of power, growing at about 0.5% of the entire US grid per year and accelerating. Natural gas turbines continue to outpace it, but that’s the only exception.

Solar, while still small overall, over doubled from the same time last year, a 108.9% increase in PV alone. The interesting thing here is not the raw number but the rates; PV is at the point wind was in 2004, just starting the upswing as the prices fall into parity range. CSP (solar thermal) will also see a major uptick this year, but remains far behind PV in adoption.

Some, if not most, of this shift in generation can be accounted for by examining capital costs. Companies looking to install new generation look at CAPEX for natgat in the $1 range, wind about the same, and coal around $2. So when the coal plants reach their end-of-life and the maintenance costs start shooting up, they replace them with NG or wind, not another coal plant.

For the consumer, you, any new generation is going to cause your rates to go up. We’ve been putting off upgrades for 30 years, so this is going to come back to haunt you. But you have a recourse; put PV on your roof. It will generate power at 15 to 20 cents forever, no matter what happens to the grid prices. And that’s why 5 GWp worth went in last year.

Here’s a graphic from one of the EIA’s pages showing new generation expected to come online over the next year. Notice that there are a bunch of large natural gas plants going in, but there’s a lot more smaller wind and PV. Coal is almost non-existent.

Image showing new generation installation in the US in 2013, natural gas, wind and solar utterly dominate

Green + Yellow ~= Red

The result is a more distributed, greener, less centralized, grid. One that has built-in systems for power shifting and transmission that makes adding even more distributed energy even easer. So then more comes on and it gets easier still. The problem of cross-country load balancing still exists, and there’s a major need to get wind power out of the mid-west, but even with these issues the shift is clearly well underway.

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