EIA’s Annual Energy Outlook 2022 For US

Renewables To Be Fastest-Growing Energy Source In US Through 2050, Yet Petroleum & Natural Gas To Stay

EIA’s Annual Energy Outlook 2022 For US

In its AEO2022, the US EIA believes renewables consumption for electricity generation grows significantly under all various scenarios it envisions, even as it trades off with nuclear, coal and natural gas. (Source: EIA)

  • EIA sees wind and solar energy as expanding their clout in the US energy generation mix by 2050, fastest than any other source
  • Battery storage specifically will complement solar that otherwise could be curtailed, thus bringing down share of non-renewables during peak hours
  • PV costs decline more slowly following near‐term pandemic impacts, supply constraints, and trade restrictions, which will have lasting effects through the projection period

Through 2050, the US will see wind and solar giving a stiff competition to natural gas becoming largest electricity generation sources in the country, driven by incentives and declining technology costs. Yet petroleum and natural gas are expected to remain the most-consumed sources of energy, according to the Annual Energy Outlook 2022 with projections to 2050 (AEO2022), released by the Energy Information Administration (EIA).

An annual feature from the EIA to cover trends and projections for energy use and supply, the report deliberates on the American energy scenario under reference case which is based on current laws and regulations—pitting them against other side cases including low renewables cost case and high renewables cost case.

As coal and nuclear generating capacity retires in the country, it will be increasingly replaced by wind and solar technologies, complemented by battery storage which is likely to lead to a reduction of natural gas- and oil-fired generation during peak hours.

Battery storage will capture solar energy that may otherwise be curtailed and thus helps improve its prospects while also reducing non-renewable generation to meet peak electric demand.

In a reference case, onsite energy generation, largely from solar PV will grow at an average annual rate of 6.1%, despite the slow decline in PV system costs than in the past. “PV costs decline more slowly following near‐term pandemic impacts and related supply constraints on materials needed to manufacture PV panels, as well as restrictions for certain PV panel imports, both of which have lasting effects through the projection period,” reads the report.

Still, distributed generation is anticipated to supply 8% of electricity consumed by the residential segment and 6% of that used by commercial building in 2050, despite declining electricity prices. Altogether, onsite solar PV systems for residential, commercial and industrial (C&I) segments will account for more than 8% of total electricity generation by 2050.

During the period between 2021 and 2050, the share of renewables in the national electricity mix more than doubles, with wind growing more than any other renewable technology between 2021 through 2024. At the end of 2024 when the Production Tax Credit (PTC) phases out, unless increased, it will be solar that will account for almost 3 quarters of the increase for renewable energy.

Yet, the analysts see policy support as essential to encourage growth of renewables along with technological advancements.

“Our baseline case projects that, without changes in laws and regulations, improvements in energy efficiency will slow the pace of growth in U.S. energy consumption, and technological progress and greater resource development will increase energy supply,” said EIA Acting Administrator Steve Nalley.

A narrative of the report can be viewed for free on EIA’s website.

According to the US Department of Energy (DOE), there is potential for solar energy to claim 40% of the national electricity mix by 2035 without raising prices (see US Wants 40% Electricity From Solar By 2035).

About The Author

Anu Bhambhani

Anu Bhambhani is the Senior News Editor of TaiyangNews

Latest Videos

Subscribe To Our Taiyang NewsLetter 
Enter your email to receive our daily solar sector updates.