Past Renewable Power Generation
U.S. Federal and State Governments have strongly supported renewable electric power supply for decades. The renewable power Industry has received $10’s Billions in financial support over the years. In addition, many States require Power Companies provide increasing renewable power levels each year. After 25 years of Government regulations and programs intended to development and grow U.S. renewable power, what have been the tangible results? Refer to the following graph.
U.S.Renewable net power generation based on DOE/EIA MER annual totals for 1987-2011.
Note: ‘Wood/waste’ includes bio-waste solid fuels or biogas produced from biomass wastes.
‘Solar’ includes PV and solar thermal.
Hydroelectric Power – Hydropower was the original U.S. renewable power source beginning the late 19th century and continues to be the largest renewable power source today. Total hydroelectric net power generation has varied over the years due to the annual rainfall, maintenance and operation restrictions imposed by regulatory agencies to possibly improve downstream ecosystems. The hydroelectric power generation average trend has been fairly constant over the past 25 years. Maintaining existing hydroelectric power capacity continues to face environmental concerns, as does possible expansion of future power generation capacity.
Geothermal Power – Geothermal became a significant power source beginning in the 1950’s. Geothermal power grew and peaked during the 1990’s and has been relatively constant ever since. The development barriers to further expansion are costs and limited access to geological formations that are suitable for new efficient geothermal power plants.
Wood and Bio-waste Power – The use of wood and bio-waste fuels for power generation began to grow in the late 1980’s. Wood fuels make up about 2/3’s of the total power generated from this class of renewable. Bio-waste fuels include biogas captured from capped municipal waste dumps and solid fuels. Wood/bio-waste provided the second largest source of U.S. renewable power until 2008. Wood/bio-waste power generation has been relatively constant since the early 1990’s. The development barriers for wood/bio-waste power generation are largely costs. The future expansion of bio-waste power generation could be supported by the possible development of cellulosic biofuels. Cellulosic biofuels byproducts or bio-waste will likely be required to fuel new power plants in order to comply with the Energy Independence and Security Act (2007) greenhouse gas reduction targets.
Solar PV/Thermal Power – Solar photovoltaic power was developed over 50 years ago and became commercially successful for smaller, ‘distributed’ (off-the-grid) niche market applications. Larger solar PV power plants, which connect into local power grids, generally developed after State and Federal Governments started supporting this renewable power source’s development in the 1980’s. Large solar thermal power plants also began to grow in the 1980’s. Both solar PV/thermal have grown relatively slowly compared to other commercial power generation sources. Although solar PV has experienced significant technology improvements and cost reductions over the past 25 years, this technology is still costlier than other renewable power sources. Solar thermal plants are higher cost than many state-of-art PV plants, but can have the advantage of energy storage capability. This storage technology allows generating power effectively round-the-clock. Although growth in solar PV/thermal power has recently increased very significantly, this Industry’s largest barrier to future expansion continues to be relatively high costs.
Wind Power – Wind power began its initial commercial development during the 1980’s and has grown at rates much greater than all other renewable power sources. Wind power began expanding very rapidly beginning the early 2000’s due to State and Federal Government support and technology developments. A contributing factor to wind power’s recent success comes from the ‘economy of size’. Earlier 50-350KW class wind turbines were generally uneconomic without perpetual Government subsidies. State-of-art 1.0-6.0 MW wind turbine technology reportedly should be sustainable without excessive subsidies. If the recent rate of growth is sustainable, wind power could possibly equal hydroelectric power within the next 20 years. Wind power expansion continues to have significant development barriers. Wind farms face ongoing environmental concerns relative to protected birds and bats, and offshore projects have been subject to huge local public opposition similar to what fossil fuel plants have historically experienced. Offshore projects, such as the MA Cape Wind project, have taken a decade to acquire needed permits.
Renewable Power Performance – A major weaknesses for wind and solar PV power generation are relatively low ‘capacity factors’. Wind and solar PV can only produce power when the wind blows and sun shines. The normal variations in wind/sunshine lead to wind power having average capacity factors of about 30% and solar PV capacity factors closer to 20%. This means that wind turbines/solar PV are only capable for delivering 30%/20% of maximum design power capacity on average during a given the year.
Wood/bio-waste, geothermal, solar thermal with energy storage capability, nuclear and all fossil fuel power plants have capacity factors of 80-90%. These technologies can supply reliable power around-the-clock, which is required for power grid ‘base-load’ capacity. The hydroelectric capacity factor is about 50% and is constrained by reservoir management. Hydroelectric can be scheduled to supply reliable around-the-clock, base-load power for limited periods of time depending on stored water availability and government agency operating constraints.
Developmental Renewable Power – Other possible renewable power technologies include hydrokinetic power from tidal/wave energy, ocean thermal and river/stream hydropower, small hydroelectric facilities, and additional types of biomass/waste fuels. All of these renewable power sources may someday become commercial, but today face very large efficiency and cost challenges compared to existing commercially successful technologies.
Past Non-Renewable Power Generation
Historically fossil fuels and nuclear have provided most U.S. electric power supply. Over the past 25 years these technologies have faced increasing costs due to more strict environmental and safety regulations. These added costs and other market related factors have significantly impacted all ‘non-renewable’ power sources. Refer to the following graph.
U.S.Non-Renewable fossil fuels and nuclear net power generation based on DOE/EIA MER annual
totals for 1987-2011. Note: Natural gas includes ‘other gases’ or the balance of all hydrocarbon gases.
Coal Power – Coal has historically been the primary source of U.S. electric power and was the most economic fuel until recently. Increasingly stricter EPA stack emission regulations have caused compliance costs to increase substantially, which has contributed to coal usage peaking in 2007. The very onerous environmental controls costs, rapid expansion of wind power, and cheaper-cleaner natural gas has led to coal’s dominance declining over the past 5 years. With the Supreme Court’s recent decision of confirming the EPA’s authority to control and reduce CO2 emissions under the Clean Air Act (1990), the barriers to existing and future coal power plant capacity continue to grow.
Natural Gas Power – Natural gas past price controls, combined with declining conventional natural gas reserves were historic barriers to expanding natural gas supplies and power generation. The combination of FERC deregulating the Industry during the 1980’s and the development of new hydraulic fracturing production technologies has led to a major renewed expansion of U.S. natural gas production. These factors have contributed to rapid growth, and even recent over supply of natural gas. Although the new coal environmental restrictions present a large opportunity for expanding natural gas power generation, natural gas production has also experienced some environmental concerns for its hydraulic fracturing production operations.
Nuclear Power – Nuclear power has experienced a very challenging development history. Following the Three Mile Island incident (1979), huge new construction project cost over-runs (1970’s-1980’s), and a massive project bankruptcy (WA ‘Whoops’ 1983), the continued growth of the nuclear power Industry appeared very uncertain by the mid 1980’s. The nuclear Industry, however, recovered from these setbacks and continued to grow throughout the 1980’s. Although the number of licensed nuclear reactors peaked in 1987 (111 units), the delivered power capacity grew by over 70% 1987-2011. This increased power generation was due to significant improvements in reliability (capacity factors) and continued technology-controls upgrades. In 2011 there are 104 licensed units. Even before the 2011 Japan Fukushima Daiichi nuclear power plant disaster, the nuclear power Industry’s expansion barriers continued to be high costs, spent fuel management, and public perceived safety concerns.
Petroleum Power – Petroleum has continuously competed with coal and natural gas. Many power plants were built with dual-fuel capability to use natural gas or petroleum fuel oil. The decline in petroleum power generation over the past 25 years has been due largely to ‘fuel switching’ to cheaper-cleaner natural gas. Today, petroleum is more often used as a backup fuel for use when natural gas supply is disrupted.
Coal’s Continuing Decline – The new EPA environmental controls on coal stack emissions is projected to prematurely retire numerous coal power plants in the future and present huge future barriers to building new coal power generation capacity. Since new state-of-art natural gas power generation and possibly wind/solar renewable power are becoming significantly cheaper to build and operate compared to modifying existing or building new coal power plants, the Industry’s shift to new natural gas and wind/solar power plants could possibly increase more rapidly in the future. This situation will also increase the demand for natural gas and eliminate the current market oversupply situation. Anticipated increased demand/market prices will encourage further increased natural gas production and future natural gas power capacity growth. Wind/solar manufacturers would also benefit from increased future demand for renewable power equipment.
Current Renewables, Fossil Fuels and Nuclear Power Generation
With renewable wind and solar power rapidly increasing in recent years, coal and petroleum power in decline, and natural gas increasing, what is the current energy supply mix for U.S. electric power generation? Refer to the following bar chart.
U.S. fossil fuels, nuclear and renewable net power generation based on DOE/EIA MER 2011 annual totals.
Coal, natural gas and petroleum currently supply 42%, 25% and 1% respectively, for a total of 68% of total net U.S. power generation. Nuclear power supplies 19% of total net power. This means that 13% of current total net U.S. power generation is supplied by renewable power. Since hydroelectric power supplies 8% of total U.S. power, the balance of (non-hydro) renewable power supplies 5% of the total net power generation. Over the past 25 years these non-hydro renewables have increased from 0.5% of total net U.S. power (1987) up to the 5% 2011 level. Wind and solar currently supply 2.9% and 0.05% respectively of total net U.S. power generation.
Wind and Solar Power Expansion Requirements – Besides the high capital costs of new wind and solar power capacity, these renewable power sources face added challenges to further expansion. ‘Economics of scale’ and the recent wind power development trends indicate that building large centralized power generation capacity is likely more cost effective than much smaller ‘distributed’ systems. Besides the added infrastructure costs to connect new wind farms and solar power plants into existing power grids, the inherent variability’s of wind and solar power generation significantly increases the complexity of properly controlling increasing levels of these renewable power sources. Upgrades and installation of advanced controls technology or a ‘smart grid’ will be definitely required. In addition, backup or redundant power supply capacity must be available to provide the full required grid power demand when wind and solar power generation varies or drops off line due to too low or high of wind conditions, and when sunlight is unavailable. Required wind/solar backup power will probably be supplied by natural gas ‘peaking’ plants that are capable to quickly ramping up or ramping down power supplied to the grid as required for system supply-demand balance and stability (reliability). Hydroelectric pumped storage, solar thermal storage and possibly other developing power storage technologies could help reduce the need for backup natural gas peaking power plant capacity. Basic market economics require that the costs to expand existing and build other possible future power storage systems should be less than the cost of state-of-art natural gas peaking power plant capacity.
Future Electric Power Projections
The DOE/EIA routinely analyzes data for all types of power generation including applicable Federal and State regulations, power markets, and general economy factors that affect future power supply-demand. The EIA then inputs these data into complex computer models and develops forecasts of future power supply-demand patterns over the next 20-25 years. These forecasts are published in Annual Energy Outlook (AEO) reports. The AEO reports are used by the Government to help develop new energy related regulations or programs. The most recent AEO 2012 (reference case) projects that wind and solar power should grow up to 185 and 23 Billion net KWH respectively by 2035. This is represents a 60% and 950% increase of electric power generated by wind and solar respectively, 2011-2035. Overall the EIA predicts total U.S. electric power consumption should increase by 681 Billion net KWH or about 18% during the next 25 years. During this same period total fossil fuels are projected to grow by 386 Billion net KWH or by 15%.
The AEO 2012 projections could possibly change significantly in future years after the EIA more fully evaluates the recent Supreme Court confirmation of EPA’s authority to reduce future coal power CO2 emissions and Congress makes a final decision on possibly extending the current renewable power tax credits scheduled to expire at year’s end.
Which Power Generation Technology Would You Recommend?
Wind and solar renewable power generation is projected to grow very significantly in the future years. Fossil fuel power capacity is projected to grow at rates greater than total renewable (KWH) capacity. If you were a large Venture Capitalist which future U.S. power technology(s) and power generation projects would you invest in?
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