|A farmer walks in front of wind turbines in Illinois.
Source: Associated Press
Growth in the U.S. renewable energy market will average more than 6% annually over the next decade as falling technology costs and support from states and the private sector help offset the loss of federal tax credits and a regulatory rollback by the Trump administration, Fitch Solutions Macro Research said June 4.
New renewable generation installations are projected to average nearly 17,000 MW of capacity annually between 2019 and 2022, the research firm said, although that figure is expected to fall to 11,000 MW during the next six years following cuts to the investment and production tax credits. By 2028, renewable resources, excluding hydroelectric power, are expected to account for 16% of the country's electricity mix, Fitch Solutions said, up from 11% in 2018.
Despite increased risks from import tariffs and a potential reduction in tax-equity financing, "the project pipeline across most segments remains robust and the U.S. renewables market continues to attract major domestic and international investment," Fitch Solutions said. The firm is an affiliate of Fitch Ratings Inc.
Still, renewables will not overtake fossil fuels any time soon. The U.S. Energy Information Administration forecast generation from natural gas to increase from 34% of U.S. electricity in 2018 to 40% by 2032 and remain at that level through 2050.
New York utility Consolidated Edison Inc., which invested more than $2 billion in wind and solar assets in 2018, plans to spend another $1 billion on renewables over the next three years, Chairman, President and CEO John McAvoy said May 21 at a natural gas conference.
"The clean energy businesses are expected to grow over time as state-level energy goals and emission reduction targets and advancements in renewable technologies continue to give us more opportunities," McAvoy said. "And we are positioned to take advantage of electric transmission opportunities to connect renewable power to the customer load center."
Demand for renewable energy is also coming from outside of the power sector.
Recurrent Energy LLC said June 4 that it signed 15-year contracts to sell electricity from solar farms in Texas to Anheuser-Busch InBev SA and Energy Transfer LP. Recurrent Energy is a subsidiary of solar-panel maker and power plant developer Canadian Solar Inc.
General Motors Co. Chairman and CEO Mary Barra told shareholders June 4 that the automaker is working toward a goal of using renewable energy to meet all of its operational electricity needs, up from 20% now.
"Our work in renewables continues to have a positive outlook based on market conditions and favorable policy," Todd Musterait, president of U.S. operations at consultancy Ecology & Environment Inc., said June 3 on a quarterly earnings call. "Major corporations, utilities and jurisdictions are responding to their shareholder and ratepayer demands for renewable energy generation and the associated electric transmission infrastructure."