Earlier this week, the United States Energy Information Agency (EIA) released figures on the new generation capacity that is expected to start operating throughout 2021. While plans can obviously change, the hope is that, with its new additions, the network looks radically different than it was just five years ago. This includes the details of where a new nuclear plant can be started, although it is overshadowed by the capacity of new batteries. But the overall picture is that, even ignoring batteries, about 80% of planned capacity additions will be emission-free.
New nuclear weapons?
EIA accounting shows that just under 40 Gigawatts of capacity will be put on the network during 2021, but there are a number of caveats to that. First, is the inclusion of batteries, which account for more than 10 percent of that value (4.3 GW). Although batteries can Look as short-term generation capacity from the perspective of “can this put energy in the grid?”, they are obviously not a net source of energy. Typically, they are used to smooth short-term fluctuations in supply or demand, rather than a stable source of energy.
Still, given the rarity of network-scale batteries until a few years ago, 4.3 GW of them are impressive.
Another oddity is a matter of time. Last year, Dominion Energy of Virginia started two offshore wind turbines as part of a pilot project that will pave the way for Coastal Virginia Offshore Wind, which will reach 2.6 GW when completed in 2024. But these turbines won’t formally enter into commercial service until this year, therefore, its count of 1.2 MW for the number of 2021.
Another case in which the numbers may not correspond to reality is the addition of 1.1 GW of nuclear energy in the form of a new reactor at the Vogtle site in Georgia. The construction of this plant and its twin sister is consistently delayed and over budget. If completed, it will represent the first new nuclear capacity added to the United States network in several years and will partially offset the closure of some smaller plants in recent years.
But the big story in 2021 will be the abandonment of fossil fuels. Despite attempts by the Trump administration to tilt the playing field in favor of coal, there will be no new coal capacity added in 2021. Given the recent closure of several large plants, this is a guarantee that the rapid decline in coal use in the United States is set to continue.
Until very recently, coal was being largely replaced by natural gas. But in recent years, wind energy prices have dropped to the point where a wind farm well located in the United States can produce energy at a price below the cost of buying fuel for an existing natural gas plant. And grid-scale photovoltaic energy really started to undermine wind energy. But the market did not respond to this new reality instantly, leaving natural gas to dominate the capacity added to the United States network in recent years.
Economy comes into action
The market is now responding clearly. Less than 20% of the capacity added in 2021 will be natural gas (6.6 GW), even if you disregard the capacity of the battery being added. That’s a drop from 34% just two years ago and more than 60% three years ago. the new additions are heavily concentrated in areas where a lot of natural gas is produced: southern Texas and near the Ohio / Pennsylvania / West Virginia borders.
Instead, wind and solar dominated, with 12.2 GW of new wind capacity and 15.4 GW of solar energy. This is especially surprising, given that the tax credits for renewable energy were set to end in 2020, leading to many projects to be completed by the end of the year. (These credits ended up being extended in a recent budget bill.) Typically, the EIA predicts that this type of expiration will cause the flow of new projects to run out, leading to a temporary drop. There is absolutely no indication that this occurred in 2021.
Notably, these figures do not include residential solar energy, which is expected to add another 3GW to 4GW capacity in 2021.
As in the past, Texas is a major site for new wind construction, along with its northern neighbor, Oklahoma. Planned additions include a wind farm that is just under one GigaWatt. Texas is also dominating solar additions, with more than a quarter of the expected new capacity. Nevada and California will also install about 10% each, but will be closely followed by North Carolina, part of a growing trend for solar installations in the southeastern United States.
The Biden government hopes to promote additional renewable energy projects as part of its pandemic recovery plan. Although they are unlikely to arrive fast enough to change the numbers for 2021, they could boost wind and solar energy even further in 2022. There are also a number of very large offshore wind projects (GW-plus) being developed along the East Coast of the USA, some of which may begin to enter service in the coming years.