U.S. Government Predicts Use of Renewables to Grow by 2020

The use of renewable energy to generate electricity in the United States will increase for the next two decades. The use of natural gas and coal will also increase, according to the latest forecast from the Energy Information Administration.

WASHINGTON, DC, US, 2001-11-28 [SolarAccess.com] “Where enacted, State renewable portfolio standards … contribute to the growth of renewables,” notes the 2002 Annual Energy Outlook. “With higher expected levels of industrial cogeneration and wind and geothermal generation, total renewable generation, including cogenerators, is projected to increase by 1.3 percent per year.” The level of renewables by 2020 will be “slightly higher” than last year’s forecast from EIA. “Renewable technologies are projected to grow slowly because of the relatively low costs of fossil-fired generation and because competitive electricity markets favor less capital-intensive natural gas technologies over coal and baseload renewables,” it says. Forecasts for the generation from coal, nuclear and renewables are higher than predicted last year due to higher projected electricity demand, assumed improvements in the operating costs and performance of nuclear plants, and higher natural gas prices. The share of generation from natural gas will increase from 16 percent in 2000 to 32 percent in 2020, while the share from coal will decline from 52 to 46 percent as a “more competitive electricity industry” invests in less capital-intensive and more efficient natural gas generation technologies. Nuclear generating capacity will drop by 2020, but a re-evaluation of aging costs for reactors and the expectation of higher natural gas prices prompted EIA to increase its projection from last year. Of the 98 gigawatts of nuclear capacity in 2000, 10 GW will be retired by 2020, less than the 26 GW of retirements in last year’s forecast. No new nuclear reactors are expected to be built by 2020 in the reference case, based on the relative economics of alternative technologies. Energy demand in the U.S. will grow by one-third by 2020, from 99 to 131 quadrillion Btu, 4 qBtu higher than projected last year. The economy is expected to recover by the middle of 2002 and increase at an average annual rate of 3.0 percent until 2020. Electricity prices are expected to decline from 6.9 to 6.3 cents per kilowatt-hour by 2015 because of increasing competition in the industry and lower coal prices, but will rise to 6.5 c/kWh by 2020 due to higher natural gas prices. Demand for natural gas will increase 50 percent by 2020, largely for electricity generation. U.S. emissions of carbon dioxide from fuel combustion will reach 2,088 million tonnes carbon equivalent in 2020, 54 percent higher than the 1990 emissions of 1,352 megatonnes. The ‘Annual Energy Outlook’ is released late each year by EIA, the statistical and analytical agency of the U.S. Department of Energy.
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