The US is witnessing a historic surge in renewable energy, marking a paradigm shift in the nation's power generation landscape. This monumental growth, fueled by record-breaking solar and wind power installations, is poised to relegate coal to the sidelines and establish renewables as the go-to option for replacing fossil fuels.
A landmark report by BloombergNEF (BNEF) reveals that nearly a quarter (23%) of US electricity demand was fulfilled by renewable sources in 2023, with green energy contributing to almost 9% of the nation's total energy consumption. This exponential rise is attributed to the massive infusion of 42 gigawatts of renewable power generation capacity into the US grid last year alone. Additionally, the crucial integration of 7.5 GW of battery storage further strengthens the resilience and reliability of the renewable energy network.
The remarkable growth of green energy is significantly bolstered by key federal initiatives such as the Inflation Reduction Act and crucial grants from the Department of Energy and other bodies. "The steadfast resilience of the sustainable energy sector is undeniable and enduring," declares Lisa Jacobson, president of the Business Council for Sustainable Energy. She emphasizes that the clean energy transition is already deeply ingrained in the US economy, and recent federal policies are proving to be instrumental in accelerating the deployment of clean technology amidst global market fluctuations.
The unprecedented growth in renewables is also disrupting the status quo of fossil fuel dependence. According to BMI, a research unit of Fitch Solutions, the dominance of coal-to-gas switching is waning, paving the way for the ascendancy of renewables. Their report predicts a dramatic decline in coal's global electricity generation share to 25% by 2032, while renewables are projected to surge to 43%, with natural gas holding a 21% share.
While the renewable energy sector celebrates its victories, challenges persist. Concerns regarding investment in the energy transition are emerging. The slowdown in electric vehicle (EV) sales has prompted US automakers to recalibrate their EV expansion plans. However, BNEF highlights that EV sales still witnessed a significant 50% increase in the US last year, reaching 1.46 million units. Additionally, low metals prices have discouraged miners from expanding output, potentially impacting the availability of critical resources for clean technologies.
Despite these headwinds, the future of renewables remains bright. Leading investment firms like Brookfield Asset Management are demonstrating continued optimism by raising billions for new clean energy funds. Moreover, BNEF reports that a staggering $303.3 billion was invested in the US energy transition, encompassing clean energy technologies, EVs, and power grid improvements.
The debate surrounding liquefied natural gas (LNG) continues to simmer in Washington, DC. President Biden's temporary halt on LNG exports, citing environmental and economic concerns, has been met with opposition. Recently, the House of Representatives passed a bill challenging the administration's authority to restrict these exports.
Natural gas power generation in the US reached a record high of 1,809 terawatt hours in 2023, constituting 43% of the total energy mix. However, the share of coal is steadily declining (currently at 15.8%), while renewables continue to gain ground (23%). This trend is expected to continue globally, with BMI projecting a 20% decrease in coal-powered generation per capita over the next decade.
By 2028, renewables are projected to capture a significant share (23.7%) of US electricity generation, surpassing both natural gas (21.9%) and coal (28.9%). This monumental shift towards cleaner energy sources paves the way for a sustainable and environmentally conscious future for the US and the world.
