US Wind Hits Record Low Price of 2.5 Cents Per Kilowatt Hour; 9-12 Gigawatts of Renewable Energy Additions Ramp up for 2014

The excuses for failing to rapidly adopt renewable energy systems grow thinner and more contorted with each passing day…

During 2013, costs for wind energy plunged to record low levels as both wind and solar set to make substantial new capacity gains in 2014 and 2015, according to a recent report from the US Department of Energy.

PPA (Power Purchase Agreement) pricing for wind during 2013 plunged to the very low range of 2.5 cents per kilowatt hour after levelized costs were included for new wind energy projects. For comparison, the average range of PPAs for all new energy sources in 2013 was 2.5 to 5 cents per kilowatt hour and included wind, solar, natural gas and coal. This made wind energy the least expensive source for new energy in 2013 following a long trend of overall falling prices.

Price of Wind at all time low

(Price of wind hits all time low in 2013 at 2.5 cents per kilowatt hour. Image source: US Department of Energy.)

Solar prices also fell to within competitive ranges, leading to record adoption rates for that energy source for the US in 2013.

New wind generation is expected to hit between 4 and 6 gigawatts in 2014 and between 5 and 9 gigawatts in 2015. Overall, 13 gigawatts of new wind energy capacity is now under construction, with the bulk focusing on the wind-rich region of the central US.

Solar is also expected to make strong gains in 2014 by adding between 5 and 7 gigawatts of new capacity. Rapidly increasing US growth in solar energy installations has been led by a combination of factors including plummeting prices and a rising adoption of home solar energy through rooftop leasing arrangements targeted to save consumers money on their power bills.

By end of 2014, total installed wind capacity is expected to hit around 74 gigawatts in the US. Meanwhile, US solar capacity is likely to climb above 18 gigawatts by year end. Altogether, these combined energy sources, when taking capacity factor into account, will have produced about 5% of the US’s electricity.

US renewables forecast 2

(US renewable energy net electrical generation from 2013 [historic] through 2018 [projected]. Image source: SUN DAY Forecast using US Energy Information Agency sources.)

With new construction projects continuing, total US renewable energy generation is expected to exceed 13.4 percent by the end of 2014 and 16.11 percent by the end of 2018.

Strong Gains Necessary to Mitigate Human-Caused Climate Change, Barriers to Adoption are Now Chiefly Political

Though the combined continued net price drop and cumulative substantial renewable energy generation gains are encouraging, they will need to advance at ever faster rates if we are to have much hope for rapidly mitigating the worst effects of human caused climate change. US generative capacity additions for renewables should probably be in the range of 2-4 times their present rate of adoption and goals should be set for the total replacement of US ghg emitting generation capacity by or before 2050.

With prices for renewable electricity generation now at levels competitive with traditional fossil fuels, and, in the case of wind, far less than fossil fuels, the primary barrier to adoption is now political. Fossil fuel related organizers have, through lobbying and media related efforts, worked on a number of fronts to water down renewable energy incentive legislation and slow or block policy measures that would speed their adoption. Many of these groups are aligned with conservative members and climate change deniers in Congress, but also include a broad array of outside organizations.

These groups represent a final, but strong road block to adoption of permanent mitigations to climate change with broad ranging benefits such as practically unlimited base fuel sources and freeing economic systems from the specter of energy scarcity and insecurity. Given both the lurking risks of human-caused climate change and the prospective benefits of widespread renewable energy generation, the time for a broad push for rapid adoption of renewable energy systems is now.

Links:

US Department of Energy Wind Energy Report for 2013

SUN DAY Forecast

Price of Wind at All Time Low of 2.5 Cents Per Kilowatt Hour

Related Reading:

Major Court Clears the Way to Let Renewables onto the Grid

Proposed Coal Export Terminal Suffers Major Setback

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