U.S. Coal Fired Power to Plummet up to 88% by 2050

Coal power Plant GeoFinancialNews.com

According to the Annual Energy Outlook 2023 (AEO2023), the United States is expected to witness a significant decline in coal fired generating capacity, dropping below half of 2022 levels by 2050.

In one of the scenarios, known as the Reference case, there is an anticipation of a 52% reduction in coal-fired capacity to 97 gigawatts (GW) by 2050. Another scenario assumes higher costs for zero-carbon technologies compared to the Reference case, resulting in a larger drop of 64% to 73 GW by 2050. Conversely, in a scenario assuming lower costs for zero-carbon technologies, report project an 88% decrease to 23 GW by the middle of the century.

The report provides a comprehensive analysis of long-term energy trends in the United States, offering insights into energy markets until 2050.

U.S. coal -fired electric-generating capacity, Annual Energy Outlook (2022-2050)

In the High Zero-Carbon Technology Cost (High ZTC) case, it assume that the costs of zero-carbon resources like renewables, nuclear, and battery storage will remain constant at 2022 levels until 2050. This assumption leads to a smaller retirement of coal-fired capacity. Conversely, in the Low Zero-Carbon Technology Cost (Low ZTC) case, it anticipate a 40% decrease in the cost of zero-carbon technologies by 2050 compared to the Reference case.

All the cases presented in the AEO2023, including the Reference, Low ZTC, and High ZTC cases, incorporate laws and regulations enacted up until mid-November, including the 2022 Inflation Reduction Act (IRA), which offers tax credits for zero-emission technologies, further reducing the cost of resources like solar and wind.

The projected 52% to 88% decline in total coal-fired capacity comprises the retirement of approximately 99 GW to 159 GW of coal-fired capacity, along with a small portion that is expected to be converted to natural gas-fired capacity. Out of the retirements, 61 GW come from coal-fired plants for which owners and operators have already announced plans to retire. Multiple factors, such as an aging coal fleet, environmental regulations, and competition from natural gas-fired, solar, and wind plants, have contributed to the diminishing economic viability of coal-fired capacity.

It is important to note that capacity represents the maximum electric output a generator can produce under specific conditions. The actual generation from wind and solar depends on the availability of sunshine or wind. While report project that the combined capacity from solar and wind will be more than three times higher in 2050 compared to 2022, fossil fuel and nuclear plants, which can operate continuously, will still contribute to a portion of the projected generation.

U.S. electricity generation mix, by Annual Energy Outlook (2022-2050) Coal
U.S. electricity generation mix, by Annual Energy Outlook (2022-2050)

In the High ZTC case, coal is expected to account for 8% of U.S. electricity generation in 2050, while solar and wind combined are projected to contribute 40%, natural gas 31%, and nuclear 13%. In the Reference case, the share of solar and wind grows to 55% of total generation by 2050, with smaller contributions of 5% from coal, 22% from natural gas, and 11% from nuclear. In the Low ZTC case, solar and wind are projected to generate 69% of electricity in 2050, with coal contributing only 1%, natural gas 11%, and nuclear 12%. The coal-fired generation in all three cases will come from newer, more efficient coal-fired power plants that remain operational because they can provide cost-effective, dispatchable power to the grid.

Read more: Is the Cost of Capital Expenditures Becoming Unaffordable?


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