Top 10 Trends That Changed Electric Power Industry
Here’s a list of the top trends that are taking place way too fast and currently changing the way in electric power industry works.
On the verge of a tremendous transformation, the way the electric power industry works might just probably exceed the greatest expectations. Vast changes in the industry continue to take place: from the decline of coal power to the rise of energy storage. What else could the future have in store?
It’s almost as if conjectures turned into predictions when the analysts’ statements toward the industry actually took into account. The traditional electric utility model upended, and utilities adjusted their business models to operate in a new energy future.
In the present, the prices for renewables and energy storage plunge quickly. The nation’s first carbon regulations are now being finalized, and the increase in numbers of distributed energy resources is growing rapidly. These show that changes in the industry is taking place way too fast than what was anticipated.
With some dubious events occurring in the in electric power sector, we have identified this information to hopefully guide you in the electric power industry and its uncertainties. Here’s a list of the top trends that are currently changing the way the electric power industry works.
1. The decline of coal power The most evident trend in the industry for most power companies and politicians is the steady retirement of coal-fired power plants. The retirement of about 25,000 MW of coal capacity is probably upsetting for those involved in the industry as it has been in great decline since 2009.
In addition, the same amount of coal capacity will be retiring by 2022. Some of the major factors that led to this decline are the loss of profit due to historically low natural gas prices, and environmental activism. The alternative for coal power, which is fossil, is also on a rough edge. Coal burn is now lower than it has been since 1980.
But even though the situation for coal power isn’t bright, the resource is still expected to be a major fuel for electricity generation in 2030 and beyond.
2. The rapid growth of natural gas Investing in gas plants is the most probable option for utilities looking to add a quick reliable capacity. Because of the retirement of coal generators, the other alternative is natural gas. Though wind and solar energy are growing quickly, it can only give power to a humble percentage of the total consumers of the US.
To ease integration of these resources and add baseload capacity, utilities can use a combined cycle gas plant. It offers a relatively quick and cheap solution that meets EPA rules on carbon and other pollutants. The future of natural gas may continue to thrive as long as it abides to the Clean Power Plan compliance, and if the prices for renewable energy won’t drop further for gas additions switching to retirements between 2020 and 2030.
3. The grid parity of renewables More traditional generation resources are often being priced out more and reaching the essence of grid parity: the point when the cost of the alternative energy becomes equal to or less than electricity from conventional energy forms like fossil fuels. Grid parity isn’t the latest of trends today but it shows a promising estimation for the industry.