The 1% increase in natural gas consumption in 2023 was driven by a 6.7% (2.2 Bcf/d) increase in consumption in the electric power sector, the largest natural gas consuming sector, EIA said. U.S. consumption of natural gas for power generation averaged 35.4 Bcf/d, or 40% of U.S. natural gas consumed in 2023.

On the other hand, natural gas consumption in the residential sector reached a five-year low at an average 12.4 Bcf/d in 2023, down by 8.9% (1.2 Bcf/d) from 2022, the largest year-over-year decline in the past five years. Natural gas consumption in the commercial sector decreased 4.8% (0.5 Bcf/d).

The summer of 2023 was the hottest recorded in the Northern Hemisphere, increasing consumption of natural gas in the electric power sector to meet demand for air conditioning, EIA said. Additionally, “warmer-than-normal” temperatures in January and February 2023 resulted in less demand for space heating in the residential and commercial sectors than in the past five years and reduced growth in total natural gas consumption in 2023 compared with 2022.

The natural gas consumption trends observed in 2023 largely continued in 2024 through September, EIA said. U.S. natural gas consumption through September 2024 averaged 89.8 Bcf/d, according to EIA’s monthly data, up 1% from the same period in 2023. The increase was driven by a 4% (1.6 Bcf/d) increase in consumption in the electric power sector, which averaged 38.1 Bcf/d, or 42% of U.S. natural gas consumed in 2024 through September.

Earlier this year, EIA predicted a 2% increase (35 BkWh) in natural gas generation in 2024. The increase was driven by low fuel costs and higher overall electricity demand, EIA said. A few new combined-cycle plants have come online in the past year, but the new capacity has been offset by other plants’ retirements, EIA added. Natural gas generation in 2024 is increasing the most in the Midwest (up 11 BkWh) and in the Mid-Atlantic (up 9 BkWh). The agency expects less natural gas generation in California this year (down 6 BkWh) and in the Southwest (down 2 BkWh), in response to large increases in solar generation.

On July 9, 2024, U.S. power plant operators generated 6.9 million MWh of electricity from natural gas on a daily basis in the lower 48 states, EIA said, which was “probably” the most in history, and definitely the most since at least January 1, 2019, when the EIA began to collect hourly data about natural gas generation.

The spike in natural gas-fired generation on July 9 was because of both high temperatures across most of the country and a steep drop in wind generation. According to the National Weather Service, most of the U.S. experienced temperatures well above average on July 9, 2024, with particularly high temperatures on the West Coast and East Coast.

Generator cost data are reported to EIA through the EIA-860, Annual Electric Generator Inventory. Average construction costs for solar generators increased by 1.7% in 2022, and for wind turbines they increased by 1.6%, EIA said.

Solar, wind and natural gas comprised 86% of the capacity added to the U.S. electric grid in 2022.

Natural Gas

Between 2021 and 2022, EIA said the average construction cost for natural gas-fired generators decreased by 11%, primarily due to a significant drop in costs for combined-cycle facilities. In 2022, the average cost for generators at combined-cycle facilities fell by 42%, reaching $722/kW.

In contrast, costs for other natural gas technologies rose in 2022. The average construction cost for a combustion turbine nearly doubled to $1,006/kW, while costs for natural gas-fueled internal combustion engines increased by 27% to $1,677/kW, the agency said.

Solar

The slight increase in solar construction was primarily driven by a 13% increase in the construction cost for crystalline silicon tracking panels, which increased to $1,605/kW, the highest price since 2018. Average overall U.S. solar construction increased to $1,588/kW.

The average construction cost for crystalline silicon fixed-tilt panels decreased by 13%, but they remained the most expensive of the major solar technologies at $1,788/kW, according to EIA. The average cost for Cadmium telluride panels also decreased by about 6% to $1,529/kW in 2022.

More generally, the average cost of U.S. solar construction has fallen in the last decade, as more utility-scale solar capacity has increased.

Wind

The average construction cost for U.S. onshore wind turbines increased in 2022 to $1,451/kW. This was driven by increases in construction costs for wind farms greater than 100 MW in nameplate capacity, EIA reported. The cost for wind farms between 100 MW and 200 MW of capacity increased by 10% to $1,614/kW.

In 2022, construction costs for the largest wind farms—those exceeding 200 MW—rose by 1.4%, reaching an average of $1,402/kW. Meanwhile, for wind farms with capacities between 1 MW and 100 MW, construction costs continued to decline, dropping by an average of 7.3% to $1,806/kW.

EIA said gas generation made up 56% of New England’s generation mix during the week of the June 16 heat wave, peaking at 61% on June 22. Between July 6 and 13, natural gas-fired electricity averaged 58% of the generation mix.

According to the agency, natural gas represented more of the generation mix during both periods compared with the five-year (2019–23) average of 48% for the June 16–23 period and 54% for July 6–13.

This is despite the closure of the Mystic Generating Station in Massachusetts in June. The Constellation Energy-owned facility was one of the oldest U.S. electric power plants. The 1,413 MW combined-cycle gas turbine (CCGT) plant was also the largest natural gas-fired power plant operating in the region managed by the Independent System Operator New England (ISO-NE).

After its initial filing for retirement in 2018, Mystic operated at low levels, generating only around 20% of its rated capacity. For its last five years, Mystic served as a peaking plant, running mainly during peak-load periods in the winter and summer when there was the most demand.

According to EIA, electricity imported from Canada and New York, as well as use of renewable generation, also increased to meet rising air-conditioning demand in New England during the June and July heat waves.

During the week in June, EIA said imports from New York and Canada accounted for 9% of the electricity mix, while wind, solar, and hydropower generation accounted for 12% of generation and nuclear accounted for 22%.

It’s a question Texas is being forced to address amidst a miserable month for wind generation, but the initial answer lends a promising prognosis to ratepayers. So far, electricity prices have remained stable despite nearly one-quarter of ERCOT’s generation profile being hampered by Mother Nature.

According to preliminary data from the U.S. Energy Information Administration (EIA), wind power in the contiguous United States produced only 302,615 megawatt hours (MWh) on Tuesday, July 23. That’s the lowest amount since… The day before, when wind power produced 335,753 MWh. Six of the 10 worst days for wind power this year have been this month (July), but previous to this week’s abysmal totals, there hadn’t been a comparably bad day since October 4, 2021.

Wind farms are on track to produce an average of just 4% of power generation this week, down from 7% last week and 12% so far in 2024, per the EIA.

So how are electricity prices fairing in ERCOT territory, which counts on wind for 28% of its fuel mix in Q2 2024? Well…

Is anyone else surprised that Texas (ERCOT) can now have very boring price days MID SUMMER when wind output is sub 200 MW

I shouldn't be, the solar obviously was going to compliment a wind profile, but this is a paradigm shift in terms of price forecasting. pic.twitter.com/SgcunfUo3b

— Andrew Gelston (@agelston) July 24, 2024

“A paradigm shift in terms of price forecasting” may sound strong, but “boring days” are far better than blackouts. Boring days are welcomed in any territory, especially during the heat of summer.

Of course, ERCOT isn’t relying entirely on renewables to keep electricity prices in check- far from it. In the lower 48, gas-fired power plants are producing an average of 48% of generation this week, up from 46% last week, according to the EIA. U.S. plants generated 6.9 million MWh of electricity from natural gas in the lower 48 states on July 9, 2024, probably the most on any day in history, says the EIA.

Texas has generally lingered between 30,000 and 40,000 MWh of natural gas generation over the last week.

The stable pricing is not just ERCOT passing gas, though (sorry, had to).

ERCOT’s commitment to diversifying its fuel mix deserves recognition, as energy research scientist Joshua D. Rhodes points out:

Updated (through Q2 2024) ERCOT fuel mix shows solar's rapid growth and that ERCOT has run on about 47% clean electricity for the first half of 2024!

Fun fact: it looks like solar is growing about twice as fast as wind did; wind: 2%->10% in 7 years, solar: 2%->10% in 4 years. pic.twitter.com/1HlTabNyDy

— Joshua D. Rhodes (@joshdr83) July 24, 2024

Rhodes’ graph makes it easy to see how rapidly solar and wind are driving coal (and to a lesser extent, natural gas) out of the fuel mix. The fact that solar is expanding nearly twice as quickly as wind generation did in Texas is likely a testament to the success of the IRA and to the staying power of the industry (and all that land fit for utility-scale installations) .

In totality, the data indicates we may have reached a tipping point- hopefully, one that keeps electricity prices stable.

This contrasts with last year, when U.S. hydropower generation fell to its lowest since 2001.

Northwest and Rockies

More hydropower is generated in the northwest and Rockies than any other region of the U.S. In 2023, 43% of all U.S. hydropower generation occurred in this region. However, last year’s hydropower output was the region’s lowest since at least 2010. Water supply, particularly in Washington and Oregon, was affected by a May heatwave that quickly melted the snowpack and reduced water supply for the rest of the year.

On April 4, the National Oceanic and Atmospheric Administration’s Northwest River Forecast Center (NWRFC) released its latest water supply forecast for the Pacific Northwest, which is part of the larger northwest and Rockies region. The NWRFC forecasts normal to more-than-normal water supply in the southern part of the region, around the Snake River Basin, and normal to less-than-normal water supply in the northern part by the Upper Columbia River Basin.

Because water supply and subsequent hydropower generation can vary widely from year to year, EIA uses these NWRFC forecasts as inputs to the STEO model. EIA expects 106 billion kWh of hydropower this year to be produced in the northwest and Rockies, or 3% more than in 2023.

EIA expects hydropower to account for 29% of the northwest and Rockies region’s electricity generation this year, and the increased output from hydropower resources and non-hydro renewables will reduce generation from natural gas and coal.

Southeast

The largest regional increase in hydropower this year comes from the southeast region, defined as the SERC Reliability Corporation. EIA expects hydropower generation in the southeast to increase by 4 billion kWh this year compared with last year. This region includes Alabama, Tennessee and North Carolina, which combined account for about 10% of total hydropower generating capacity in the U.S.

EIA expects hydropower to account for 5% of electricity generation in the southeast in 2024. Natural gas and nuclear are the two largest sources of electricity generation in the southeast, and EIA expects both to increase in 2024. In particular, nuclear generation will increase after the Vogtle Unit 4 generator in Georgia starts providing power to the grid during the second quarter of 2024. EIA expects these increases in natural gas, nuclear and hydropower to reduce the use of coal for electricity generation in the region.

California

California’s water supply is susceptible to drought. After a very wet year last year, annual hydropower generation increased by more than 80%, from 17 billion kWh in 2022 to 31 billion kWh in 2023. EIA expects similar hydropower generation in California this year.

The California-Nevada River Forecast Center expects California to have a near-to-above normal water supply. Water reservoirs in California are also mostly above their historical averages for this time of year. In addition, snowstorms between the end of January and end of March increased snowpack across the Sierra Nevada mountain range.

Non-hydro renewables, mainly solar and wind, are the most significant component of change in California’s electricity generation mix. EIA expects California’s non-hydro renewables to increase by 5 billion kWh in 2024.

Rest of the U.S.

EIA expects hydropower to increase in nearly every region, with notable increases in New York and the central region (Southwest Power Pool or SPP). About 6% of U.S. hydropower capacity is located in New York, and EIA expects the state’s hydropower output to increase slightly, to 29 billion kWh.

The SPP region includes many of the states just east of the Rocky Mountains. In 2023, SPP’s hydropower output fell to 11 billion kWh, the least in at least a decade. EIA expects SPP’s hydropower will increase to 14 billion kWh in 2024.

Additionally, the eclipse will “partially” block sunlight to facilities with a combined 84.8 GW of capacity in an even larger swath of the United States around peak solar generating time.

For solar sites in the path of totality, the moon will block all direct sunlight for more than four minutes, the EIA said, while the partial eclipse could limit sunlight in the path of totality for more than two hours. Areas not directly within the path of totality will experience varied levels of lower solar generation.

However, the eclipse was hardly a surprise, and utilities and co-ops began preparing long in advance. Electricity generators in affected areas have detailed their plans to increase generation from other sources to make up for the lost solar output.

The loss of utility-scale solar generation will mostly be replaced by balancing authorities dispatching other sources of generation. However, homes and businesses using small-scale solar will require more electricity than usual, and since this generation is not managed by balancing authorities, EIA says this increased demand is likely to appear as an overall power demand increase on the grid.

Texas will be hit the hardest, EIA said, because most of the state is within the path estimated to lose 90% to 99% of solar power during the eclipse. On the other hand, while California is in the 40% to 59% “partial” reduction range, the EIA said the state’s “significant” reliance on utility-scale and small-scale solar means the eclipse will have a heavier impact. The EIA also noted that in Florida, when the eclipse occurs, solar generation is likely to be the second-leading energy source in the state, accounting for 20% of total generation.

Additionally, battery storage will play a role in the response. There is 15.4 GW of battery storage in the U.S. today, compared to the 0.6 GW during the last solar eclipse in 2017, the EIA said. Solar capacity has also grown significantly since the last eclipse, with almost 100 GW of utility-scale and small-scale solar capacity added since.

Utility-scale solar was 8% (91 GW) of total U.S. capacity at the end of 2023, and can be the third-largest source of midday generation during the spring and summer months. During the 2017 eclipse, solar was the fifth-leading energy source in the U.S., behind natural gas, coal, nuclear, and hydropower. Even accounting for the eclipse, the EIA estimates solar generation will still be the third-largest source of electricity on April 8, behind natural gas and nuclear.

Originally published in Renewable Energy World.

Developers plan to expand U.S. battery capacity to more than 30 GW by the end of 2024. Planned and currently operational U.S. utility-scale battery capacity totaled around 16 GW at the end of 2023.

Battery storage in the U.S. has been growing since 2021. This is especially true in California and Texas, two states that have seen rapid renewable energy growth.

California has the most installed battery storage capacity of any state with 7.3 GW, with Texas with 3.2 GW. All other states combined have a total of around of 3.5 GW of installed capacity.

According to EIA, the five largest new U.S. battery storage projects scheduled to be deployed in California and Texas in 2024 or 2025 are:

• Lunis Creek BESS SLF (Texas, 621 MW)
• Clear Fork Creek BESS SLF (Texas, 600 MW
• Hecate Energy Ramsey Storage (Texas, 500 MW)
• Bellefield Solar and Energy Storage Farm (California, 500 MW)
• Dogwood Creek Solar and BESS (Texas, 443 MW)

Solar to continue growth, gas to remain unchanged

EIA’s latest Short-Term Energy Outlook is the first to include forecasts for 2025.

The agency projects solar power to be the leading source of growth in electricity generation in both 2024 and 2025, as 36 GW and 43 GW of new solar capacity come on line, respectively. The new capacity would boost the solar share of total generation to 6% in 2024 and 7% in 2025, up from 4% in 2023.

Coal-fired capacity would continue to plummet the next two years, according to EIA projections. EIA expects a decline by 9% in 2024 and by 10% in 2025, with 12 GW of coal-fired capacity retiring over the next two years.

Accordingly, EIA projects U.S. coal production to decline by more than 90 million short tons (MMst) to less than 490 MMst in 2024 and then fall below 430 MMst in 2025, the least coal produced in the U.S. since the early 1960s.

EIA expects generation from natural gas to not change in 2024 and 2025, compared with 2023.

16 natural gas-fired plants are expected to come online this year, EIA said in its Monthly Electric Generator Inventory. This includes both combined-cycle and simple-cycle plants concentrated near the Gulf Coast and Appalachia regions, as well as in Florida. Ten of these plants have already come online.

In 2022, 11 natural gas-fired power plants came online, adding 5.6 GW of capacity. Total natural gas-fired capacity additions increased in both 2022 and 2023 after declines in the previous three consecutive years.

EIA expects 20 new gas-fired power plants to come online in 2024 and 2025, with a total capacity of 7.7 GW.

During 2022 and 2023, a total of 13 new combined-cycle plants will have entered service. The average output for each of the plants in 900 MW of electric generating capacity. EIA expects 4.9 GW of additional CCGT additions in 2024 and 2025

During 2022 and 2023, 14 simple-cycle plants will have begun operations. The average output for each of the plants is almost 140 MW of electric generating capacity. Over half of the new SCGT capacity coming online in 2022 and 2023 is located in Texas, which has periods of high daily peak electricity demand throughout the summer and has had significant growth in renewable energy during the last few years.

EIA is projecting global energy-related carbon dioxide emissions to increase through 2050 in all forecasted cases except its Low Economic Growth case.

While the world would continue to shift from fossil to non-fossil energy sources, EIA said this would be offset by global population growth, regional economic shifts toward more manufacturing and increased energy consumption as living standards improve.

EIA projects global electricity generation will increase by 30% to 76% in 2050 from 2022 across all cases and will primarily be met by zero-carbon technologies.

For all cases, EIA projects that 81% to 95% of the new electric-generating capacity installed from 2022 to 2050 will be zero-carbon technologies. As a result, by 2050, the combined share of coal and natural gas would fall to between 27% and 38% of the installed global generating capacity.

According to the projections, renewables and nuclear could provide as much as two-thirds of global electricity generation by 2050.

EIA does project global renewable energy consumption, particularly solar and wind, to grow faster than any other energy source. The projected rise in renewable energy consumption is largely driven by its increased use in the electric power sector.

Battery storage capacity is projected to increase from less than 1% of global power capacity in 2022 to a range of 4% to 9% of global power capacity by 2050.

Read the full International Energy Outlook here.