The Future of U.S. Power Generation Belongs to Solar (and Wind and Batteries)

With all of the ambitious goal-setting around cutting carbon emissions, it’s easy to question whether these targets are for real or just so much political hype. Just last week, President Biden upped the ante on the nation’s switch to electric vehicles, announcing new regulations that would effectively require auto makers to achieve 67% EV sales by 2032.  That’s a huge leap from last year, when just 5.8% of new vehicles sold were all-electric.

But when it comes to getting the nation’s power generating fleet off of fossil fuels by 2035 – and replacing it mainly with renewable fuels like wind and solar – America’s power companies appear to at least be heading the right direction. Or at least that’s the way it looks based on planned grid interconnections by hundreds of electricity developers in coming years.  With renewables racing ahead, natural gas power plants now account for less than 4% of planned capacity additions in the United States, while coal plants orders have all but disappeared.

Source:  Lawrence Berkeley National Laboratory and Bloomberg NEF

Tracking Power Plant Orders

The Lawrence Berkeley National Laboratory, a government research center focused on science and technology issues, keeps close tabs on the nation’s power supply.  Each year, it tallies up just how much new electric generating capacity power companies want to build, including what types of power and where it will be installed.  Its latest annual report tallies more than 10,000 energy projects where developers are seeking permission to hook into the nation’s grid.

All told, these planned projects represent more than 2 terawatts of power generation — or about 50% more than current U.S. generating capacity.  Almost all of this planned new capacity (93%) is solar, wind or battery storage.  While it’s always uncertain how many of these projects will come to fruition because of permitting or funding problems, the pipeline is now so dominated by renewables that the die appears to be cast, with solar leading the way.

Times Have Changed

It didn’t used to be this way.  Fifteen years ago, it was onshore wind that dominated grid interconnection requests, followed by natural gas.  Since then, many of these planned wind and natural gas projects have hooked up successfully, shrinking their pool of future capacity additions, while other planned orders have fallen by the wayside.  

Meanwhile, solar requests for grid interconnections have been on a tear over the last decade, vaulting into the lead for planned capacity additions five years ago.  And since 2019, offshore wind interconnection requests have gone from zero to more than 100 gigawatts of planned additions.  

It’s battery storage, however, that’s making the biggest move these days.  In 2022, there were more than 300 GW of standalone battery storage projects in the interconnection queue, and more than 400 GW of combined solar power and battery storage projects.

On the other hand, new coal and nuclear plant orders have become so vanishingly small that they don’t even register in the charts shown below.  There are only 6.5 gigawatts’ worth of nuclear plants seeking interconnections at present (which is still the highest amount in the past seven years).  As for coal, less than 1.5 GW worth of total capacity is now in the hopper — down from 42 GW 15 years ago.  As of 2007, gas and coal together represented more than 35% of the grid interconnection queue.  Today, their combined share is down to just 3.5%.

Based on the interconnection requests being tracked by Lawrence Berkeley Labs, more than half of the planned capacity additions are taking a “hybrid” approach, whereby batteries are placed alongside a power generator and share the same grid connection.  Nearly all of this hybrid capacity is connected to wind or solar, although there are a few gigawatts of storage planned alongside some gas-fired power plants as well. 

Planned Grid Interconnections by Power Type

Source:  Lawrence Berkeley National Laboratory and Bloomberg NEF

Not So Fast?

While the path ahead for the nation’s power supply looks increasingly green and carbon-free – as solar, wind and batteries come to the fore – there still are some speed bumps that could slow down the pace of deployment.  According to Lawrence Berkeley Labs, the average time required for a developer to receive an interconnection agreement has roughly doubled since 2015, with the average waiting time now approaching three years.  

These delays add carrying costs to developers and result in lower returns on investment, higher electricity prices or both.  It even causes some developers to withdraw their projects after they have received regulatory approval because their seed capital has run out.  

Fortunately, for those who receive interconnection approval and actually start construction on their projects, building schedules have remained relatively stable.  Even so, project times vary widely by region.  While the nationwide average to build a grid-connected project is two years, some big states like California now take four to six years to complete utility-scale projects.  Last week, a high-voltage transmission line linking Wyoming wind power to power-hungry utility customers in California and Arizona got final regulatory approval – after 15 years of review!

Spring to the Head of the Line!

Assuming current trends identified in the latest Lawrence Berkeley Labs report hold up, the future of the nation’s power supply is no longer in doubt.  It really does belong to solar, wind and batteries (with a shrinking supply coming from natural gas) as carbon-based electricity production winds down.  The next big challenge will be building enough of these renewable energy plants in time to decarbonize the entire U.S. fleet by 2035, which is the goal of the Biden administration and a key stepping stone to achieving nationwide net-zero carbon emissions by 2050.

Fortunately, you don’t have to wait to achieve this clean energy goal in your own life.  You can start down this clean energy path with help from Solaflect Energy.  Thanks to 30% investment tax credits and other financial incentives built into the Inflation Reduction Act passed by Congress last summer, there has never been a better time to purchase solar panels or electric vehicles – which now qualify for generous government support.  With a busy summer installation season ahead, now is the time to schedule an appointment for a site visit with one of our solar advisors.  

Solaflect Energy is your trusted home energy management partner.  We help you install clean and affordable solar electricity for a more resilient and climate-friendly future.  For more information email us, or call (802) 649-3700.  Working together, the power is in our hands to make a difference.

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