First, the good news, followed by the not so good. That’s the opening line in many jokes. And as it happens, in climate change.
The good news is that according to the Energy Information Administration (EIA) nearly half of the planned new capacity additions in the US in 2022 are expected to be solar, 17% wind with natural gas accounting for 21% (see graph below).
The bad news is that the US greenhouse gas emissions rose nearly 6% in 2021 with the economy rebounding from the pandemic.
With President Biden’s Build Back Better bill in political limbo, it is not clear how the US can remotely meet its ambitious pledge to cut emissions in half by 2030 made at the COP26 in Glasgow in November, 2021.
The EIA expects 46.1GW of new generating capacity to be added to the US grid in 2022. Utility-scale solar is expected to account for 21.5GW, surpassing last year’s 15.5GW, with Texas leading the states with 6.1GW, or 28%, followed by California with 4GW. These numbers do not include small-scale distributed solar, which is also on the rise.
Wind had an exceptionally good 2021, adding17.1GW. Only 7.6 GW of wind is scheduled to come online in 2022, more than half of it – 51% – in Texas.
The accompanying map (below) shows the location of generation additions with the largest wind farm, the 999MW Traverse Wind Energy Center in Oklahoma, expected to begin commercial operations in April 2022.
Despite relatively high natural gas prices, the EIA expects 9.6 GW of new natural gas-fired capacity to come online, 8.1GW of which as combined-cycle plants with the rest combustion-turbine plants. Most of the planned natural gas capacity additions are concentrated in 4 states: Ohio, Florida, Michigan, and Illinois.
Utility-scale battery storage, which can be considered generation or load, is expected to grow by 5.1 GW, or 84% in 2022 as its costs continue to fall. Batteries are increasingly paired with renewables, particularly solar, to increase their value in competitive wholesale markets.
Nuclear is expected to add roughly 5% to the country’s capacity additions as 2 new reactors at the Vogtle nuclear power plant in Georgia are expected to come online in 2022 after many delays.
The Georgia plants are the last reactors to be built for quite a while since no others are currently planned or even contemplated. There has been some talk about small modular reactors (SMRs) but this editor will believe it when he sees one. More on nuclear power on page 16.
For coal, the longer-term trend is down even if it had a temporary rebound in 2021. Coal accounts for 85% of 2022 retirements while no new coal-fired plants were built or planned at the moment. US coal operators have scheduled 14.9GW of capacity to retire this year.
Between 2015 to 2020 coal retirements averaged 11.0 GW/year. The existing US coal fleet is ageing with many plants built in the 1970s and 80s. These old, inefficient and highly polluting plants face increasing competition from renewables and natural gas as well as pressure to cut down emissions.
The bad news is that despite the fact that the US electricity generation mix is getting cleaner, cutting emissions will be difficult.
Even if the electricity sector were converted to renewables and nuclear, the transport, heating and the industrial sectors will continue emitting carbon until they are electrified.
In 2021, the rise of natural gas prices led to increased reliance on coal consumption at existing power plants – an unfortunate reversal of long established trends.
President Biden’s $1.7 trillion Build Back Better proposal includes $555 billion targeted to climate with $320 billion for clean energy and electric vehicle tax credits over the next 10 years. But delivering on pledges made by the president will be an uphill battle for a number of reasons:
-
First, the US Senate is currently split 50-50 between the 2 parties leaving Biden no margin for missing even a single Democratic vote;
-
Second, Democrats are going into mid-term elections in Nov 2022 with the likelihood that they may lose the control of the Senate and end up with a narrower majority in the House – or worse; and
-
Third, as in all democracies, there are limits to what Biden can do through Executive Orders or changes in regulations.
Among the many challenges a few stand out:
- In June 2021, a federal judge in Louisiana sided with 13 Republican states who had challenged Biden on his legal authority to ban or restrict leases on federal lands;
- Next, as oil, natural gas and gasoline prices surged in 2021, Biden was forced to drop his opposition to increasing US oil & gas production while he was urging world leaders to stop burning fossil fuels;
- Embarrassingly, just days after returning from Glasgow, the Interior Department auctioned off nearly 80 million acres in the Gulf of Mexico, a new record for offshore drilling, reversing a campaign promise to end drilling on federal lands and waters;
- This action alone is expected to result in extraction of 1.12 billion barrels of oil and 4.4 trillion cubic feet of natural gas over the life of the 50-year leases;
- After passing in the House in Nov 2021, his signature $1.7 trillion Build Back Better Bill, is stuck due to opposition by a single Democratic holdout, Senator Joe Manchin of West Virginia whose motivations appear disingenuous (Box next page); and
-
Making matters worse, the US Supreme Court is expected to hear a case brought by a number of Republican-controlled states and coal companies who claim that Biden’s Environmental Protection Agency (EPA) has over-reached its authority in trying to cut carbon emissions.
Is Manchin protecting coal miners or coal mining companies?
After Senator Joe Manchin single handedly frustrated the passage of Biden’s signature legislation in the Senate in Dec 2021, the United Mine Workers of America (UMWA), which represents West Virginia coal miners, urged him to reconsider his opposition to President Biden’s Build Back Better plan.
The labor union noted that the bill includes an extension of a fund that provides benefits to coal miners suffering from black lung disease, which are due to expire at the end of the year, as well as tax incentives that encourage investment in abandoned coalfields that would employ thousands of miners who lost their jobs. In a prepared statement Cecil Roberts, the Union’s president said,
“For those and other reasons, we are disappointed that the bill will not pass,” adding, “We urge Senator Manchin to revisit his opposition to this legislation and work with his colleagues to pass something that will help keep coal miners working, and have a meaningful impact on our members, their families, and their communities.”
Manchin, who owns stock in a coal brokerage firm, appears to be more interested to help coal mining companies that the coal miners.
Without the support of the Congress, the chances of US emissions being cut in half by 2030, daunting to begin with, appear farfetched. After the mid-term elections in Nov 2022, Biden is expected to have even less support in the Congress, thus gravely handicapped to pass any legislation.
His energy and environmental ambitions will remain largely unfulfilled and what little progress he is able to achieve may be overturned in 2024. American politics tend to take big swings every 4 to 8 years.
Reflecting on the second world war, Winston Churchill said, “Success is not final, failure is not fatal. It is the courage to continue that counts.” As we enter 2022, Biden will need a lot of courage to remain relevant. And that is really bad news.
Fereidoon P. Sioshansi, Ph.D, is president of Menlo Energy Economics, and editor and publisher of EEnergy Informer. This article is reproduced from that newsletter with his permission.
