Following up on last year's thread, time to look at Annual Energy Outlook 2020, released by EIA Wednesday: eia.gov/outlooks/aeo/
A huge step forward this year is considering alternate cases for renewables costs. As I wrote last year, the lack of such scenarios had been a persistent blindspot in EIA outlooks. Thank you EIA!!
thehill.com/opinion/energy…
thehill.com/opinion/energy…
In the reference case, CO2 emissions stay flat through 2050, with transportation the largest source and more industrial gas use offsetting less power plant coal. Nowhere near Obama's Paris pledge of 80% reduction by 2050, or Dems' targets of net-zero by then.
Depending on the scenario, the US oil boom is nearing its peak or continuing to soar.
In a major shift, EIA now projects that renewables will overtake gas as the leading source of electricity, with solar outpacing wind. Renewables will surpass coal far sooner.
Unlike AEOs from years ago that wildly overestimated solar costs, #AEO2020 has plausible scenarios for renewables costs.
Coal and nuclear are oddly insensitive to renewables costs, which mainly affect gas. NEMS neglects ongoing pressure for utilities to close coal. Coal will likely continue to plunge far faster than AEOs project.
This chart illustrates more clearly NEMS' inability to project coal closures beyond those already announced. It also projects continued additions of solar but virtually no new wind after tax credits phase down, which seems unlikely given state and corporate targets.
A nice illustration of how remarkably stable electricity prices are compared to wildly uncertain prices for gas and liquid fuels. Another benefit of electric cars.
A big wildcard across scenarios is how much wind is added mid-continent, and how much solar in the Southeast.
Battery storage correlates with solar but not wind, which EIA projects will more often be paired with gas CTs.
Nuclear faces huge risks from low gas prices
EIA again tries to catch a falling knife on coal, with the peculiar projection that remaining coal plants will rebound in output rather than close. Count me among the skeptics.
Fuel economy merely keeps pace with growing travel, keeping fuel use high. This keeps transportation by far the largest CO2 source as electricity cleans up. Huge challenge for climate policy.
EIA projects gasoline continues to dominate, even as EV sales soar. Now that EIA has added much welcomed renewables costs scenarios, this is the area that most sorely needs alternate scenarios. As I've written before, EV projections keep varying widely. thehill.com/blogs/pundits-…
Industrial uses of natural gas, especially for chemicals, becomes the big growth area for CO2 emissions, offsetting most of the declines from power plants. Alongside transportation, industry becomes the most daunting challenge for climate policy.
A reminder of EIA's track record on predicting coal. US coal production is likely to fall below 600 million tons this year -- literally off the charts.
A reminder that Obama's Clean Power Plan aimed to cut power plant emissions to around 1.6 billion metric tons/year by 2030. We'll likely get there this year without the policy. When EIA projects too high, cap-and-trade policies become too weak.
