6 utility trends to look out for in 2019
The following is a viewpoint from Joseph Daniel, a senior energy analyst at the Union of Concerned Scientists.
The electric utility industry is abuzz with terms like blockchain and hosting capacity analysis. While the industry is certainly likely to hear more about these topics in the coming year, applications will likely be isolated to a few states in 2019.
The sector is undergoing change and we can expect a few larger, national trends to manifest. From changes in the resource mix to federal shakeups, here are six electricity trends to keep an eye on in 2019:
1. Coal continues to decline:
Coal’s decade long decline will continue in 2019. Four gigawatts (GW) are already committed to retirement and industry analysts project more than that will come to fruition by the end of 2019.
But coal retirements will only account for a portion of year-on-year coal consumption reductions.
Reduced generation from operating plants will be the main driver for reduced consumption. More coal plants will follow the recent trend to switch to seasonal operations because it isn’t economic to operate them year-round. Those that do operate year-round will do so at lower levels, barring a polar-vortex like event.
2. Renewables keep up the momentum:
There are more than 15 GW of utility scale wind and solar trying to become operational in 2019. If federal tax credits become permanent, it would alleviate some of the pressure to get built in 2019. But regardless, renewables should be able to regain the title as the number one source of new capacity additions.
The industry should also expect some projects to come in at record low prices, despite tariffs. 2019 will also see the installation of the 100th GW of wind in the US and the 4th consecutive year where developers hit 10 GW of solar installations (including residential, commercial and utility scales).
3. The rush to overbuild build gas:
When it comes to gas, the utility industry is repeating past mistakes, ignoring both the environmental costs and lack of public support for natural gas generation (unless you count paying for a supporting cast).
2019 will see a continuation of the trend to overbuild and over-rely on gas.
EIA tracks developer plans to build new natural gas combined cycle (NGCC) projects; separately, it projects how much is needed based on economic modeling. Comparing those two data sets reveals that the utility industry is poised to build three-times more NGCC capacity than is necessary….