- EIA has reduced its annual new capacity addition forecast for solar and wind power installations due to COVID-19 impact
- For solar the forecast is a 10% reduction from its previous one that now expects 12.6 GW of new utility scale solar to be added
- EIA has reduced the forecast as it anticipates impact of COVID-19 and the eventual economic slowdown
The US government’s Energy Information Administration (EIA) has lowered the annual forecast for renewable energy capacity to be installed in the US in 2020, due to the impacts of the coronavirus on energy markets, that it says are ‘still evolving’. Even though it expects renewables to still be the fastest growing source of electricity generation compared to the rest this year, in its latest Short-Term Energy Outlook (STEO), the EIA has revised its expectation for new capacity build up due to the effects of COVID-19 and the resultant economic slowdown.
For solar, the expectation now is 12.6 GW of utility scale solar capacity addition in 2020, and for wind power the forecast has been lowered to 19.4 GW of new capacity, 10% and 5% lower than its estimate in its previous STEO, respectively.
Altogether, the EIA expects US electric power sector generation to decline by 3% this year with renewable energy sources accounting for the largest proportion of new generating capacity growing by 11% in the electric power sector. It assumes that half of the generating capacity previously expected to come online in Q2/2020 will be postponed to sometime beyond the STEO forecast period along with one-quarter of the capacity expected for Q3/2020. The assumptions may be revised going forward, it added.
“The forecast for lower overall electricity demand leads to an expected decline in fossil-fuel generation, especially at coal-fired power plants. EIA expects that coal generation will fall by 20% in 2020. Forecast natural gas generation rises by 1% this year, reflecting favorable fuel costs and the addition of new generating capacity,” the EIA STEO reads.
In a recent update, Wood Mackenzie Power & Renewables said they expect more than 5 GW of utility scale solar power capacity in the US at risk of getting delayed due to coronavirus impact. These could be postponed to late 2020 or 2021, it feared.
In January 2020, the EIA predicted utility scale solar capacity addition of 13.48 GW and 18.46 GW of wind power this year (see EIA: 32 GW Solar & Wind Capacity In US In 2020).