US Renewable Energy Grows to 14% with Little Impact on End-user Prices

"According to the U.S. Energy Information Administration (EIA)'s latest "Electric Power Monthly" report, with data for the first six months of 2014, renewable energy sources (i.e., biomass, geothermal, hydropower, solar, wind) provided 14.3 percent of net U.S. electrical generation. Conventional hydropower accounted for 7.0 percent, while non-hydro renewables provided an even larger share at 7.3 percent. Overall, electrical generation from non-hydro renewable energy sources (i.e., biomass, geothermal, solar, wind) expanded by 10.4 percent compared to the first half of 2013, according to the EIA. "  Renewable Energy World.

This growth in US renewable energy largely occurs in state markets that use the residential portfolio system or green electricity quotas. These are implemented by green certificates as used in Poland, Sweden and the UK. The remarkable part about the growth is that it occurs during a period of uncertainly over the federal tax credit as well as in a market with much lower priced traditionally generated electricity than Europe. 

I noted in an earlier article (PL) that the US has largely gone to renewable energy without serious impacts on end user prices for electricity. A 15% green energy target for the United States (RPS) was projected to only cause a “cumulative electricity and natural gas expenditures increase … [of] 0.3%.” U.S. Energy Information Agency (2007). “A review of state-level RES policies shows that utilities are successfully meeting their annual renewable energy requirements with little or no additional cost to consumers (emphasis added).” Livermore National Lab (2013). So now green energy hits 14% and is growing,even as shale gas causes lower traditional energy costs. 

There are some lessons here. Principally that the transition to more a renewable energy mix can occur without huge feed-in tariffs. European countries are frequently offered 30 to 50 Euro cents a kWhr for green electricity. One key is distributed energy, which uses local sources to produce energy and largely eliminates transmission costs. Here in Poland, that is about half of the end-user's bill. 

UBS Bank just released a report today that predicts increasing changes in this direction:

"By 2025, everybody will be able to produce and store power. And it will be green and cost competitive, ie, not more expensive or even cheaper than buying power from utilities."

“Large-scale power generation, however, will be the dinosaur of the future energy system: Too big, too inflexible, not even relevant for backup power in the long run,” UBS writes.

As we struggle to  get better provisions in the new Renewable Energy Law, this is good stuff to keep in mind!