Meet 125 Mgmt Teams
The Long Story Short – Growth of renewables surpassed expectations, but diversity is still key
Are Fossil Fuels Going the Way of the Dinosaurs?(Note: companies that could be impacted by the content of this article are listed at the base of the story (desktop version). This article uses third-party references to provide a bullish, bearish and balanced point of view; sources listed in the "Balanced" section)
There has been an exponential rise in the U.S. in renewable energy for electricity needs. Currently, 33% of
Ambitious expectations. Renewable energy currently produces 700 billion kilowatt
hours of electricity. The Edison
Electric Institute (EEI), an association of American electric companies,
projects that amount will double by 2045 and represent 50% of all electric production. The Department of Energy’s National Renewable
Energy Laboratory supports an even rosier picture claiming renewable energy
could represent 80% of production by 2050. Supporters point out that costs have decreased
to a point that the case for renewable fuels is no longer simply based on
Running on fumes. Renewable skeptics argue that renewable generation
is not economic without government subsidies ($18.4 billion in 2016). They are quick to point to the inconsistency
of wind and solar power. They also point
out the need for an improved transmission system should renewable energy
continue to grow. Perhaps their best
argument, however, is that the growth of renewable energy does not occur within
an economic vacuum. As the demand for
coal and oil powered generation decreases, the demand and thus price for these
fuels decreases. This, in turn, will
make coal and oil generations less expensive relative to renewable fuels.
The growing importance of renewable generation is no longer a debate. Renewable fuels can compete both on environmental and economic basis. That said, economic comparisons can change quickly over the fifty-year life of a power plant or farm. Producers of energy would be wise to maintain a balanced portfolio of fuel sources to best be prepared for shifts in production costs.
Delivering America’s Energy Future, EEI President Presentation to Wall Street, February 6, 2019.
US Energy Information Administration, EIA “Renewable energy production and consumption by source”, March 26, 2019.
EIA’s Annual Energy Outlook 2019 projects growing oil, natural gas, renewables production, EEI “Today in Energy”, January 24, 2019.
Renewable Energy Can Provide 80 Percent of U.S. Electricity by 2050, Union of Concerned Scientists
The US is smashing its clean energy forecasts, World Economic Forum, 10/1/2017.