A Guest Post by Islandboy

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The EIA released the latest edition of their Electric Power Monthly on September 26th, with data for July 2017. The table above shows the percentage contribution to two decimal places for the last two months and the year to date.

In July all dispatchable base load generators, that is Coal, Natural Gas and Nuclear powered plants, continued to ramp up production to deal with the increase in demand coinciding with the peak, mid-summer demand period. As a result, despite generating some 4,300 GWh more than it did in June, the percentage contribution from Nuclear continued it’s decline, going from 18.84% to 17.83% in July. Another result of the increase in the total amount generated was that, a 620 GWh decrease in the absolute contribution from Solar, translated to the percentage contribution declining to 2.04%, down from 2.47% in May. The gap between the contribution from All Renewables and Nuclear widened as All Renewables fell to 15.72% as opposed to Nuclear’s 17.83% contribution. While the amount of electricity generated by Wind held steady the percentage contribution declined by 0.6%. The contribution from Hydro continued to decline both in absolute and percentage terms. The combined contribution from Wind and Solar declined to 6.9% from 7.93% in June and the contribution from Non-Hydro Renewables fell to 8% from 9%. The contribution of zero emission and carbon neutral sources, that is, nuclear, hydro, wind, solar, geothermal, landfill gas and other biomass fell from 36.5% to 33.5%.

The graph below helps to illustrate how the changes in absolute production affect the percentage contribution from the various sources.

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The graph below shows the total monthly generation at utility scale facilities by year versus the contribution from solar. The left hand scale is for the total generation, while the right hand scale is for solar output and has been deliberately set to exaggerate the solar output as a means of assessing it’s potential to make a meaningful contribution to the midsummer peak. This July solar accounted for about eight percent of the additional peak mid summer demand, that is, eight percent of the approximately 100,000 GWh difference between the spring/autumn lows and the mid summer peak.

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The graph below shows the monthly capacity additions for 2017 to date. In July 57 percent of capacity additions were Natural Gas. Solar and Wind added 8.2 percent and 28.5 percent respectively. Hydro contributed 3 percent of new capacity, Wood Waste Biomass made a contribution of 3 percent and Other Waste Biomass made up 0.19 percent. Batteries made up 0.14 percent. I have added a line to indicate the total new capacity added each month to give an idea of what the absolute amounts were added from each source. In June the total capacity added was 1,693.4 MW.

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The graph below from the Solar Energy Industries Association’s Solar Industry Data web page shows US capacity additions from 2010 to 2016.

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For 2015 and 2016, solar and wind combined made up 69% and 65% of new capacity respectively with natural gas accounting for 29% of new capacity in both years. In 2014 wind and solar combined accounted for 52% of new capacity with natural gas accounting for 43% and coal just 1%. The previous year, 2013 saw wind and solar combined accounting for just over a third of new capacity with natural gas accounting for 47% and coal 10%. In 2012 solar and wind accounted for half of the new capacity with natural gas accounting for 31% and coal 16%. It would appear that 2017 is continuing the trend of more natural gas, solar and wind capacity additions and less coal capacity additions.

To get a better grasp of the trends, I decided to look at US generating capacity retirements in addition to capacity additions. Below is a graph of monthly US capacity retirements for 2017 year to date.

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For 2017 year to date, 3348 MW of coal capacity has been retired, along with 981 MW of natural gas capacity and 550 MW of capacity fueled by petroleum liquids.

To further examine the trends in capacity changes, I looked up the data for 2015 in Table 4.6. Capacity additions, retirements and changes by energy source at the EIA’s Electric Power Annual web page and downloaded the table for the years 2010 to 2014. The data for capacity additions and retirements for coal, natural gas, wind and solar was extracted to create a table to which a column was added for each source to indicate the net change, that is, additions minus retirements. The Electric Power Annual with data for 2016 is scheduled for release in November so, to get data for 2016, I extracted the totals from Tables 6.3 and 6.4 of the edition of the Electric Power Monthly with the data up to the end of December 2016. Below is a graph showing the net change for each fuel source for each year from 2010 to 2016.

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It is worthy of note that coal has seen net capacity reductions since 2012 while all the other sources in the graph have seen net capacity increases. In total, between 2010 and 2016 coal generating capacity declined by almost 33 GW while natural gas saw an increase of 23.6 GW, wind increased by 45.5 GW and solar by 20.5 GW as shown below.

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If these trends were to continue it would be difficult to envisage anything but continuing decline in the US coal industry. However the current US administration is doing everything in its power to make it more attractive to use coal for electricity generation including, repealing the previous (Democratic) administration’s Clean Power Plan and appointing a lobbyist for coal giant Murray Energy and former staffer to Sen. James Inhofe as deputy administrator of the EPA, along with a Notice of Proposed Rulemaking that would aim to provide “full recovery of costs” for power plants that keep 90 days of fuel supplied onsite as compensation for “all the attributes they provide.”.

The problem is that, coal plant closures are being driven by hard economic circumstances rather than government regulations, the old, inefficient coal plants are being put under severe pressure by newer more efficient plants fueled by low cost natural gas. It would appear that even though gas prices have increased from their historical lows, the price of natural gas is still low enough to make it a more economic choice for many utilities. In addition, the costs of wind and solar technology are continuing to decline, making them more attractive as time goes by. In all likelihood the decision makers at the utilities are aware that the costs of wind and solar are likely to continue declining, making investments in coal burning plants an obviously risky proposition. It remains to be seen if the measures being taken by the current administration will see increased use of coal and a reduction in coal plant closures or even new coal plants being built.

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