EIA Predicts Summer Energy Usage Will be Higher
Wind and solar power take up the slack as rising natural gas prices make fossil fuels less attractive.
According to the US Energy Information Administration (EIA), the total US retail sales of electricity to end-use customers this summer will be 0.4% higher than last summer. The prediction is part of the EIA’s Summer Electricity Outlook, a supplement to its May 2022 Short-Term Energy Outlook. Further, the agency says that the largest increases in US electric power sector generation this summer will come from renewable energy sources.
Image used courtesy of Pixabay
Utility-scale Solar Forecast
The forecast shows that utility-scale solar generation will grow between June and August 2022 by 10 million megawatt-hours (MWh) compared with the same period last summer. Wind generation will grow by 8 million MWh in that same period. Generation of electricity from coal and natural gas is predicted by the EIA to decline by 26 million MWh this summer.
The EIA expects the largest increases in US electric power sector generation this summer will come from renewable energy sources. These increases are the result of new capacity additions. Utility-scale solar generation between June and August 2022 will grow by 10 million MWh compared with the same period last summer, and wind generation will grow by 8 million MWh. Image used courtesy of the EIA Summer Electricity Outlook
Grid-level wind and solar power electric-generating capacity has been growing steadily in recent years. By June, the EIA estimates that the US will have 65 gigawatts (GW) of utility-scale solar generating capacity, representing a 31% increase in solar capacity since June 2021. The Administration expects that renewables will be the only electricity generation source that will significantly increase compared with last summer and that this growth will be driven primarily by large buildouts of new solar capacity. The electric power sector will also have an estimated 138 GW of wind capacity online this June, which is a 12% increase over last June.
Natural Gas Declines
The EIA also predicts that electricity produced using natural gas will decline by 1.3% compared to last summer, primarily due to higher natural gas prices in 2022 this summer compared to last year. A significant number of coal plants were retired in recent years and the remaining coal plants are limited by regulations regarding emissions, so it is unlikely that there will be more electricity generation from coal to replace natural gas usage. The higher natural gas prices will lead to increases in both wholesale and retail electricity prices this summer, especially since natural gas prices have shown high degrees of volatility in recent months.