Hydro Ottawa asks customers for feedback on five-year plan

By Hydro Ottawa


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OTTAWA, ONTARIO – Hydro Ottawa has launched a website and online survey to seek input from its customers on a five-year distribution plan that will help determine the company’s priorities and rates between 2016 and 2020.

The customer consultation is designed to collect consumer feedback on the reliability of OttawaÂ’s electricity distribution system and the spending decisions Hydro Ottawa will make over the next five years.

The plan highlights major issues the utility is looking to address, including:

- Replacing aging infrastructure past the anticipated end-of-life, with some more than 50 years old

- Serving a growing city and population, including building infrastructure needed to serve new communities, intensification projects and the Light Rail Transit project

- Improving the power system with targeted investments that will restore outages more quickly and/or remotely and

- Refurbishing and replacing costly facilities and equipment.

All feedback collected will be included with the utilityÂ’s application to its regulator, the Ontario Energy Board, as part of the rate setting process. Focus groups and telephone surveys are also being conducted.

To learn more about Hydro OttawaÂ’s five-year plan and to complete the online survey, please visit hydroottawa.com/survey.

Quick Facts

- Hydro Ottawa bills customers and collects payments, but only keeps about 20 percent of what the customer pays. The other 80 percent is passed on, without mark-up, to other companies responsible for generating electricity, transmitting it, and to regulators and the provincial government.

- Hydro OttawaÂ’s distribution rates must be approved by the Ontario Energy Board based on applications by the utility. The rate setting process is open and transparent, with opportunities for public participation. - Hydro Ottawa must submit evidence to demonstrate the amount of funding it needs to safely and reliably distribute electricity to its customers.

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Overturning statewide vote, Maine court energizes Hydro-Quebec's bid to export power

Maine Hydropower Transmission Line revived by high court after referendum challenge, advancing NECEC, Hydro-Quebec supply, Central Maine Power partnership, clean energy integration, grid reliability, and lower rates across New England pending land-lease ruling.

 

Key Points

A court-revived NECEC line delivering 1,200 MW of Hydro-Quebec hydropower via CMP to strengthen the New England grid.

✅ Maine high court deems retroactive referendum unconstitutional

✅ Pending state land lease case may affect final route

✅ Project could lower rates and cut emissions in New England

 

Maine's highest court on Tuesday breathed new life into a $1-billion US transmission line that aims to serve as conduit for Canadian hydropower, after construction starts drew scrutiny, ruling that a statewide vote rebuking the project was unconstitutional.

The Supreme Judicial Court ruled that the retroactive nature of the referendum last year violated the project developer's constitutional rights, sending it back to a lower court for further proceedings.

The court did not rule in a separate case that focuses on a lease for a 1.6-kilometre portion of the proposed power line that crosses state land.

Central Maine Power's parent company and Hydro-Québec teamed up on the project that would supply up to 1,200 megawatts of Canadian hydropower, amid the ongoing Maine-Quebec corridor debate in the region. That's enough electricity for one million homes.

Most of the proposed 233-kilometre power transmission line would be built along existing corridors, but a new 85-kilometre section was needed to reach the Canadian border, echoing debates around the Northern Pass clash in New Hampshire.

Workers were already clearing trees and setting poles when the governor asked for work to be suspended after the referendum in November 2021, mirroring New Hampshire's earlier rejection of a Quebec-Massachusetts proposal that rerouted regional plans. The Maine Department of Environmental Protection later suspended its permit, but that could be reversed depending on the outcome of legal proceedings.

The high court was asked to weigh in on two separate lawsuits. Developers sought to declare the referendum unconstitutional while another lawsuit focused on a lease allowing transmission lines to cross a short segment of state-owned land.

Supporters say bold projects such as this one, funded by ratepayers in Massachusetts, are necessary to battle climate change and introduce additional electricity into a region that's heavily reliant on natural gas, which can cause spikes in energy costs, as seen with Nova Scotia rate increases recently across the Atlantic region.

Critics say the project's environmental benefits are overstated — and that it would harm the woodlands in western Maine.

It was the second time the Supreme Judicial Court was asked to weigh in on a referendum aimed at killing the project. The first referendum proposal never made it onto the ballot after the court raised constitutional concerns.

Although the project is funded by Massachusetts ratepayers, the introduction of so much electricity to the grid would serve to stabilize or reduce electricity rates for all consumers, proponents contend, even as Manitoba Hydro rate hikes face opposition elsewhere.

The referendum on the project was the costliest in Maine history, topping $90 million US and underscoring deep divisions.

The high-stakes campaign put environmental and conservation groups at odds, and pitted utilities backing the project, amid the Hydro One-Avista backlash, against operators of fossil fuel-powered plants that stand to lose money.

 

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Hydro One CEO's $4.5M salary won't be reduced to help cut electricity costs

Hydro One CEO Salary shapes debate on Ontario electricity costs, executive compensation, sunshine list transparency, and public disclosure rules, as officials argue pay is not driving planned hydro rate cuts for consumers.

 

Key Points

Hydro One CEO pay disclosed in public filings, central to debates on Ontario electricity rates and transparency.

✅ 2016 compensation: $4.5M (salary + bonuses)

✅ Excluded from Ontario's sunshine list after privatization

✅ Government says pay won't affect planned hydro rate cuts

 

The $4.5 million in pay received by Hydro One's CEO is not a factor in the government's plan to cut electricity costs for consumers, an Ontario cabinet minister said Thursday amid opposition concerns about the executive's compensation and wider sector pressures such as Manitoba Hydro's rising debt in other provinces.

Treasury Board President Liz Sandals made her comments on the eve of the release of the province's so-called sunshine list.

The annual disclosure of public-sector salaries over $100,000 will be released Friday, but Hydro One salaries such as that of company boss Mayo Schmidt won't be on it.Though the government still owns most of Hydro One — 30 per cent has been sold — the company is required to follow the financial disclosure rules of publicly traded companies, which means disclosing the salaries of its CEO, CFO and next three highest-paid executives, and financial results such as a Q2 profit decline in filings.

New filings show that Schmidt was paid $4.5 million in 2016 — an $850,000 salary plus bonuses — and those top five executives were paid a total of about $11.7 million. 

"Clearly that's a very large amount," said Sandals. Sandals wouldn't say whether or not she thought the pay was appropriate at a time when the government is trying to reduce system costs and cut people's hydro bills.

Mayo Schmidt, President & CEO of Hydro One Limited and Hydro One Inc. (Hydro One )

But she suggested the CEO's salary was not a factor in efforts to bring down hydro prices, even as Hydro One shares fell after a leadership shakeup in a later period. "The CEO salary is not part of the equation of will 'we be able to make the cut,"' she said. "Regardless of what those salaries are, we will make a 25-per-cent-off cut." The cut coming this summer is actually an average of 17 per cent -- the 25-per-cent figure factors in an earlier eight-per-cent rebate.

NDP Leader Andrea Horwath, who has proposed to make hydro public again in Ontario, said the executive salaries are relevant to cutting hydro costs.

"All of this is cost of operating the electricity system, it's part of the operating of Hydro One and so of course those increased salaries are going to impact the cost of our electricity," she said.

Schmidt was appointed Aug. 31, 2015, and in the last four months of that year earned $1.3 million, but the former CEO was paid $745,000 in 2014. About 3,800 workers were paid over $100,000 that year, none of whom will be on the sunshine list this year.

Progressive Conservative energy critic Todd Smith has a private member's bill that would put Hydro One salaries back on the list, amid investor concerns about Hydro One that cite too many unknowns.

"The Wynne Liberals don't want the people of Ontario to know that their rates have helped create a new millionaire's club at Hydro One," Smith said. "Hydro One is still under the majority ownership of the public, but Premier Kathleen Wynne has removed these salaries from the public's watchful eye."

The previous sunshine list showed 115,431 people were earning more than $100,000 — an increase of nearly 4,000 people despite the fact 3,774 Hydro One workers were not on the list for the first time.

Tom Mitchell, the former CEO at Ontario Power Generation who resigned last summer, topped the 2015 list at $1.59 million.

 

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Energy Security Support to Ukraine

U.S. Energy Aid to Ukraine delivers emergency electricity grid equipment, generators, transformers, and circuit breakers, supports ENTSO-E integration, strengthens energy security, and advances decarbonization to restore power and heat amid Russian attacks.

 

Key Points

U.S. funding and equipment stabilize Ukraine's power grid, strengthen energy security, and advance ENTSO-E integration.

✅ $53M for transformers, breakers, surge arresters, disconnectors

✅ $55M for generators and emergency heat to municipalities

✅ ENTSO-E integration, cybersecurity, nuclear safety support

 

In the midst of Russia’s continued brutal attacks against Ukraine’s energy infrastructure, Secretary of State Blinken announced today during a meeting of the G7+ on the margins of the NATO Ministerial in Bucharest that the United States government is providing over $53 million to support acquisition of critical electricity grid equipment. This equipment will be rapidly delivered to Ukraine on an emergency basis to help Ukrainians persevere through the winter, as the country prepares for winter amid energy challenges. This supply package will include distribution transformers, circuit breakers, surge arresters, disconnectors, vehicles and other key equipment.

This new assistance is in addition to $55 million in emergency energy sector support for generators and other equipment to help restore emergency power and heat to local municipalities impacted by Russia’s attacks on Ukraine’s power system, while both sides accuse each other of energy ceasefire violations that complicate repairs. We will continue to identify additional support with allies and partners, and we are also helping to devise long-term solutions for grid restoration and repair, along with our assistance for Ukraine’s effort to advance the energy transition and build an energy system decoupled from Russian energy.

Since Russia’s further invasion on February 24, working together with Congress, the Administration has provided nearly $32 billion in assistance to Ukraine, including $145 million to help repair, maintain, and strengthen Ukraine’s power sector in the face of continued attacks. We also have provided assistance in areas such as EU integration and regional electricity trade, including electricity imports to stabilize supply, natural gas sector support to maximize resource development, support for nuclear safety and security, and humanitarian relief efforts to help Ukrainians to overcome the impacts of energy shortages.

Since 2014, the United States has provided over $160 million in technical support to strengthen Ukraine’s energy security, including to strengthen EU interconnectivity, increase energy supply diversification, and promote investments in energy efficiency, renewable energy, and clean energy technologies and innovation.  Much of this support has helped prepare Ukraine for its eventual interconnection with Europe’s ENTSO-E electricity grid, aligning with plans to synchronize with ENTSO-E across the integrated power system, including the island mode test in February 2022 that not only demonstrated Ukraine’s progress in meeting the EU’s technical requirements, but also proved to be critical considering Russia’s subsequent military activity aimed at disrupting power supplies and distribution in Ukraine.

 

Department of Energy (DOE)

  • With the increased attacks on Ukraine’s electricity grid and energy infrastructure in October, DOE worked with the Ukrainian Ministry of Energy and DOE national laboratories to collate, vet, and help prioritize lists of emergency electricity equipment for grid repair and stabilization amid wider global energy instability affecting supply chains.
  • Engaged at the CEO level U.S. private sector and public utilities and equipment manufacturers to identify $35 million of available electricity grid equipment in the United States compatible with the Ukrainian system for emergency delivery. Identified $17.5 million to support purchase and transportation of this equipment.
  • With support from Congress, initiated work on full integration of Ukraine with ENTSO-E to support resumption of Ukrainian energy exports to other European countries in the region, including funding for energy infrastructure analysis, collection of satellite data and analysis for system mapping, and work on cyber security, drawing on the U.S. rural energy security program to inform best practices.
  • Initiated work on a new dynamic model of interdependent gas and power systems of Europe and Ukraine to advance identification and mitigation of critical vulnerabilities.
  • Delivered emergency diesel fuel and other critical materials needed for safe operation of Ukrainian nuclear power plants, as well as initiated the purchase of three truck-mounted emergency diesel backup generators to be delivered to improve plant safety in the event of the loss of offsite power.

U.S. Department of State

  • Building on eight years of technical engagement, the State Department continued to provide technical support to Naftogaz and UkrGasVydobuvannya to advance corporate governance reform, increase domestic gas production, provide strategic planning, and assess critical sub-surface and above-ground technical issues that impact the company’s core business functions.
  • The State Department is developing new programs focused on emissions abatement, decarbonization, and diversification, acknowledging the national security benefits of reducing reliance on fossil fuels to support Ukraine’s ambitious clean energy and climate goals and address the impacts of reduced supplies of natural gas from Russia.
  • The State Department led a decades-long U.S. government engagement to develop and expand natural gas reverse flow (west-to-east) routes to enhance European and Ukrainian energy security. Ukraine is now able to import natural gas from Europe, eliminating the need for Ukraine to purchase natural gas from Gazprom.

 

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Amazon Announces Three New Renewable Energy Projects to Support AWS Global Infrastructure

AWS Renewable Energy Projects deliver new wind power for AWS data centers in Ireland, Sweden, and the US, adding 229 MW and 670,000 MWh annually, supporting 100% renewable targets and global cloud sustainability.

 

Key Points

AWS projects add wind power in Ireland, Sweden, and the US to supply clean energy for AWS data centers.

✅ 229 MW new wind capacity; 670,000 MWh annual generation

✅ Sites: Donegal (IE), Backhammar (SE), Tehachapi (US)

✅ Advances 100% renewable goal for global AWS infrastructure

 

 Amazon has announced three new clean energy projects as part of its long-term goal to power all Amazon Web Services (AWS) global infrastructure with renewable energy. These projects – one in Ireland, one in Sweden, and one in the United States – will deliver wind-generated energy that will total over 229 megawatts (MW) of power, with expected generation of over 670,000 megawatt hours (MWh) of renewable energy annually. The new projects are part of AWS’s long-term commitment to achieve 100 percent renewable energy for its global infrastructure. In 2018, AWS exceeded 50 percent renewable energy for its global infrastructure.

Once complete, these projects, combined with AWS’s previous nine renewable energy projects, reflect how renewable power developers benefit from diversified sources and are expected to generate more than 2,700,000 MWh of renewable energy annually – equivalent to the annual electricity consumption of over 262,000 US homes, which is approximately the size of the city of Nashville, Tennessee.

“Each of these projects brings us closer to our long-term commitment to use 100 percent renewable energy to power our global AWS infrastructure,” said Peter DeSantis, Vice President of Global Infrastructure and Customer Support, Amazon Web Services. “These projects are well-positioned to serve AWS data centers in Ireland, Sweden, and the US. We expect more projects in 2019 as we continue toward our goal of powering all AWS global infrastructure with renewable energy.”

Amazon has committed to buying the energy from a new wind project in Ireland, a 91.2 MW wind farm in Donegal. The Donegal wind farm project is expected to deliver clean energy no later than the end of 2021.

“AWS’s investment in renewable projects in Ireland illustrates their continued commitment to adding clean energy to the grid and it will make a positive contribution to Ireland’s renewable energy goals,” said Leo Varadkar, An Taoiseach of Ireland. “As a significant employer in Ireland, it is very encouraging to see Amazon taking a lead on this issue. We look forward to continuing to work with Amazon as we strive to make Ireland a leader on renewable energy.”

Amazon will also purchase 91 MW of power from a new wind farm in Bäckhammar, Sweden, which is expected to deliver renewable energy by the end of 2020.

“Sweden has long been known for ambitious renewable energy goals, and this new wind farm showcases both our country’s leadership and AWS’s commitment to renewable energy,” said Anders Ygeman, Sweden’s Minister for Energy and Digital Development. “This is a significant step in Sweden’s renewable energy production as we work toward our target of 100 percent renewable energy by 2040.”

California leads the United States in renewable electricity generation from non-hydroelectric sources, as US solar and wind growth accelerates, and the state’s Tehachapi Mountains, where AWS’s wind farm will be located, contain some of the largest wind farms in the country. The wind farm project in Tehachapi is expected to bring up to 47 MW of new renewable energy capacity by the end of 2020.

“This announcement from AWS is great news, not just for California, but for the entire country, as it reaffirms our role as a leader in renewable energy and allows us to take an important step forward on deploying the clean energy we need to respond to climate change,” said California State Senator Jerry Hill, San Mateo and Santa Clara Counties, a member of the Senate Standing Committee on Energy, Utilities and Communications.

Beyond the sustainability initiatives focused on powering the AWS global infrastructure, Amazon recently announced Shipment Zero, which is Amazon’s vision to make all Amazon shipments net zero carbon, with 50 percent of all shipments net zero by 2030. Additional sustainability programs across the company include Amazon Wind Farm Texas, which adds more than 1 million MWh of clean energy each year, alongside Amazon Wind Farm US East that is now fully operational, demonstrating scale. In total, Amazon has enabled 53 wind and solar projects worldwide, which produce more than 1,016 MW and are expected to deliver over 3,075,636 million MWh of energy annually, while peers like Arvato's solar power plant underscore broader momentum across the industry. These projects support hundreds of jobs, while providing tens of millions of dollars of investment in local communities, with Iowa wind power offering a strong example. Amazon has also set a goal to host solar energy systems at 50 fulfillment centers by 2020. This deployment of rooftop solar systems, aided by cheap batteries that enhance storage, is part of a long-term initiative that will start in North America and spread across the globe. Amazon also implemented the District Energy Project that uses recycled energy for heating Amazon offices in Seattle. For more information on Amazon’s sustainability initiatives, visit www.amazon.com/sustainability.

 

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Electric cars will challenge state power grids

Electric Vehicle Grid Integration aligns EV charging with grid capacity using smart charging, time-of-use rates, V2G, and demand response to reduce peak load, enable renewable energy, and optimize infrastructure planning.

 

Key Points

Aligning EV charging with grid needs via smart charging, TOU pricing, and V2G to balance load and support renewables.

✅ Time-of-use rates shift charging to off-peak hours

✅ Smart charging responds to real-time grid signals

✅ V2G turns fleets into distributed energy storage

 

When Seattle City Light unveiled five new electric vehicle charging stations last month in an industrial neighborhood south of downtown, the electric utility wasn't just offering a new spot for drivers to fuel up. It also was creating a way for the service to figure out how much more power it might need as electric vehicles catch on.

Seattle aims to have nearly a third of its residents driving electric vehicles by 2030. Washington state is No. 3 in the nation in per capita adoption of plug-in cars, behind California and Hawaii. But as Washington and other states urge their residents to buy electric vehicles — a crucial component of efforts to reduce carbon emissions — they also need to make sure the electric grid can handle it amid an accelerating EV boom nationwide.

The average electric vehicle requires 30 kilowatt hours to travel 100 miles — the same amount of electricity an average American home uses each day to run appliances, computers, lights and heating and air conditioning.

An Energy Department study found that increased electrification across all sectors of the economy could boost national consumption by as much as 38 percent by 2050, in large part because of electric vehicles. The environmental benefit of electric cars depends on the electricity being generated by renewables.

So far, states predict they will be able to sufficiently boost power production. But whether electric vehicles will become an asset or a liability to the grid largely depends on when drivers charge their cars.

Electricity demand fluctuates throughout the day; demand is higher during daytime hours, peaking in the early evening. If many people buy electric vehicles and mostly try to charge right when they get home from work — as many now do — the system could get overloaded or force utilities to deliver more electricity than they are capable of producing.

In California, for example, the worry is not so much with the state’s overall power capacity, but rather with the ability to quickly ramp up production and maintain grid stability when demand is high, said Sandy Louey, media relations manager for the California Energy Commission, in an email. About 150,000 electric vehicles were sold in California in 2018 — 8 percent of all state car sales.

The state projects that electric vehicles will consume 5.4 percent of the state’s electricity, or 17,000 gigawatt hours, by 2030.

Responding to the growth in electric vehicles will present unique challenges for each state. A team of researchers from the University of Texas at Austin estimated the amount of electricity that would be required if every car on the road transitioned to electric. Wyoming, for instance, would need to nudge up its electricity production only 17 percent, while Maine would have to produce 55 percent more.

Efficiency Maine, a state trust that oversees energy efficiency and greenhouse gas reduction programs, offers rebates for the purchase of electric vehicles, part of state efforts to incentivize growth.

“We’re certainly mindful that if those projections are right, then there will need to be more supply,” said Michael Stoddard, the program’s executive director. “But it’s going to unfold over a period of the next 20 years. If we put our minds to it and plan for it, then we should be able to do it.”

A November report sponsored by the Energy Department found that there has been almost no increase in electricity demand nationwide over the past 10 years, while capacity has grown an average of 12 gigawatts per year (1 GW can power more than a half-million homes). That means energy production could climb at a similar rate and still meet even the most aggressive increase in electric vehicles, with proper planning.

Charging during off-peak hours would allow not only many electric vehicles to be added to the roads but also utilities to get more use out of power plants that run only during the limited peak times through improved grid coordination and flexible demand.

Seattle City Light and others are looking at various ways to promote charging during ideal times. One method is time-of-day rates. For the Seattle chargers unveiled last month, users will pay 31 cents per kilowatt hour during peak daytime hours and 17 cents during off-peak hours. The utility will monitor use at its charging stations to see how effective the rates are at shifting charging to more favorable times.

The utility also is working on a pilot program to study charging behavior at home. And it is partnering with customers such as King County Metro that are electrifying large vehicle fleets, including growing electric truck fleets that will demand significant power, to make sure they have both the infrastructure and charging patterns to integrate smoothly.

“Traditionally, our utility approach is to meet the load demand,” said Emeka Anyanwu, energy innovation and resources officer for Seattle City Light.

Instead, he said, the utility is working with customers to see whether they can use existing assets without the need for additional investment.

Numerous analysts say that approach is crucial.

“Even if there’s an overall increase in consumption, it really matters when that occurs,” said Sally Talberg, head of the Michigan Public Service Commission, which oversees the state’s utilities. “The encouragement of off-peak charging and other technology solutions that could come to bear could offset any negative impact.”

One of those solutions is smart charging, a system in which vehicles are plugged in but don’t charge until they receive a signal from the grid that demand has tapered off a sufficient amount. This is often paired with a lower rate for drivers who use it. Several smart-charging pilot programs are being conducted by utilities, although they have not yet been phased in widely, amid ongoing debates over charging control among manufacturers and utilities.

In many places, the increased electricity demand from electric vehicles is seen as a benefit to utilities and rate payers. In the Northwest, electricity consumption has remained relatively stagnant since 2000, despite robust population growth and development. That’s because increasing urbanization and building efficiency have driven down electricity needs.

Electric vehicles could help push electricity consumption closer to utilities’ capacity for production. That would bring in revenue for the providers, which would help defray the costs for maintaining that capacity, lowering rates for all customers.

“Having EV loads is welcome, because it’s environmentally cleaner and helps sustain revenues for utilities,” said Massoud Jourabchi, manager of economic analysis for the Northwest Power and Conservation Council, which develops power plans for the region.

Colorado also is working to promote electric cars, with the aim of putting 940,000 on the road by 2030. The state has adopted California’s zero-emission vehicles mandate, which requires automakers to reach certain market goals for their sales of cars that don’t burn fossil fuels, while extending tax credits for the purchase of such cars, investing in charging stations and electrifying state fleets.

Auto dealers have opposed the mandate, saying it infringes on consumer freedom.

“We think it should be a customer choice, a consumer choice and not a government mandate,” said Tim Jackson, president and chief executive of the Colorado Automobile Dealers Association.

Jackson also said that there’s not yet a strong consumer appetite for electric vehicles, meaning that manufacturers that fail to sell the mandated number of emission-free vehicles would be required to purchase credits, which he thinks would drive up the price of their other models.

Republicans in the state have registered similar concerns, saying electric vehicle adoption should take place based on market forces, not state intervention.

Many in the utility community are excited about the potential for electric cars to serve as mobile energy storage for the grid. Vehicle-to-grid technology, known as V2G, would allow cars charging during the day to take on surplus power from renewable energy sources.

Then, during peak demand times, electric vehicles would return some of that stored energy to the grid. As demand tapers off in the evening, the cars would be able to recharge.

In practice, V2G technology could be especially beneficial if used by heavy-duty fleets, such as school buses or utility vehicles. Those fleets would have substantial battery storage and long periods where they are idle, such as evenings and weekends — and even longer periods such as summer and the holiday season when school is out. The batteries on a bus, Jourabchi said, could store as much as 10 times the electricity needed to power a home for a day.

 

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EIA expects solar and wind to be larger sources of U.S. electricity generation this summer

US Summer Electricity Outlook 2022 projects rising renewable energy generation as utility-scale solar and wind capacity additions surge, while coal declines and natural gas shifts amid higher fuel prices and regional supply constraints.

 

Key Points

An EIA forecast of summer 2022 power: more solar and wind, less coal, and shifting gas use amid higher fuel prices.

✅ Solar +10 million MWh; wind +8 million MWh vs last summer

✅ Coal generation -20 million MWh amid supply constraints, retirements

✅ Gas prices near $9/MMBtu; slight national gen decline

 

In our Summer Electricity Outlook, a supplement to our May 2022 Short-Term Energy Outlook, we expect the largest increases in U.S. electric power sector generation this summer will come from renewable energy sources such as wind and solar generation. These increases are the result of new capacity additions. We forecast utility-scale solar generation between June and August 2022 will grow by 10 million megawatthours (MWh) compared with the same period last summer, and wind generation will grow by 8 million MWh. Forecast generation from coal and natural gas declines by 26 million MWh this summer, although natural gas generation could increase in some electricity markets where coal supplies are constrained.

For recent context, overall U.S. power generation in January rose 9.3% year over year, the EIA reports.

Wind and solar power electric-generating capacity has been growing steadily in recent years. By the start of June, we estimate the U.S. electric power sector will have 65 gigawatts (GW) of utility-scale solar-generating capacity, a 31% increase in solar capacity since June 2021. Almost one-third of this new solar capacity will be built in the Texas electricity market. The electric power sector will also have an estimated 138 GW of wind capacity online this June, which is a 12% increase from last June.

Along with growth in renewables capacity, we expect that an additional 6 GW of new natural gas combined-cycle generating capacity will come online by June 2022, an increase of 2% from last summer. Despite this increase in capacity, we expect natural gas-fired electricity generation at the national level will be slightly (1.3%) lower than last summer.

We forecast the price of natural gas delivered to electric generators will average nearly $9 per million British thermal units between June and August 2022, which would be more than double the average price last summer. The higher expected natural gas prices and growth in renewable generation will likely lead to less natural gas-fired generation in some regions of the country.

In contrast to renewables and natural gas, the electricity industry has been steadily retiring coal-fired power plants over the past decade. Between June 2021 and June 2022, the electric power sector will have retired 6 GW (2%) of U.S. coal-fired generating capacity.

In previous years, higher natural gas prices would have resulted in more coal-fired electricity generation across the fleet. However, coal-fired power plants have been limited in their ability to replenish their historically low inventories in recent months as a result of mine closures, rail capacity constraints, and labor market tightness. These coal supply constraints, along with continued retirement of generating capacity, contribute to our forecast that U.S. coal-fired generation will decline by 20 million MWh (7%) this summer. In some regions of the country, these coal supply constraints may lead to increased natural gas-fired electricity generation despite higher natural gas prices.
 

 

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