EIA: Additions of electricity generation could begin to decrease

May 12, 2015 | By Jaclyn Brandt

Electricity generation in the United States could be much lower than in the past, according to the Energy Information Association's (EIA) Annual Energy Outlook 2015 (AEO2015), which looked at different reference cases, depending on certain factors. Although the reference case in the outlook has total generating capacity increasing from 1,065 gigawatts (GW) in 2013 to 1,261 GW in 2030, the yearly additions are still projected to begin decreasing. According to EIA, 287 GW is expected to be added in that time, while only 90 GW is expected to retire.

Additions to electric generating capacity. Click on image to enlarge. Credit: EIA

"Capacity additions through 2017, much of which are under construction, average about 17 GW per year and about half are non-hydro renewable plants (mainly wind and solar) prompted by federal tax incentives and renewable portfolio standards," EIA said in a statement. "From 2018 to 2024, projected capacity additions average less than 4 GW per year, as earlier planned additions are sufficient to meet most growth in electricity demand."

The report also found that average annual capacity additions from 2025 to 2040 will average 12 GW a year -- mostly in natural gas-fired and renewable technologies. Between 2000 and 2013, additions each year averaged 26 GW.

The reference case also found that natural gas-fired plants will account for 58 percent of capacity additions through 2040. Renewable sources will account for 38 percent and nuclear will account for 3 percent.

According to EIA, this is because "natural gas-fired combined-cycle plants are relatively inexpensive to build in comparison with new coal, nuclear, or renewable technologies, and are generally more efficient to operate than existing steam plants that may be powered by natural gas, oil, or coal."

The renewable sources being added to the grid are being helped because of federal tax credits as well as renewable targets. In the EIA reference case, 109 GW of renewable capacity is added to the grid, which includes 49 GW of wind and 48 GW of solar. The case found that 9 GW will be added in nuclear -- including 6 GW from plants already under construction and another 3 GW to be built after 2029. Coal will also add 1 GW to the grid.

The reference case of electricity capacity only takes into account current rules and regulations, and because the Clean Power Plan (CPP) is not currently in place, the case did not factor that in to the reference case.

"The analysis in the AEO2015 includes several cases that examine different assumptions of macroeconomic growth, world oil prices, and higher oil and natural gas resource availability, which yield a range of projected capacity additions," EIA explained. "Policies such as the proposed Clean Power Plan, or the continuation of tax credits for certain renewable energy technologies that are scheduled to expire under current law can also have a significant effect on projected capacity additions and retirements."

For more:
- see this report

http://www.fierceenergy.com/story/eia-additions-ectricity-generation-could-begin-decrease/2015-05-12