Through James Morton Turner, professor of environmental studies at Wellesley College and author of the forthcoming book Recharged: A History of Batteries and Lessons for a Clean Energy Future. He published the editorial in the magazine Science‘s special issue on climate change two weeks ago (June 24, 2022).
In 2001, the US Energy Information Administration peered into its crystal ball and predicted the future of US electricity supply until 2020 from clean energy, what went wrong.
The EIA forecasts were much like more of the same. In short, they expected the beginning of the 21st century to be very much like the end of the 20th century. They predict more coal, a small role for renewables and steady growth in aggregate demand for electricity. The only major change expected by the EIA was a boom in the use of natural gas for electricity generation.
For natural gas, at least according to the numbers, it appears that the EIA has done well. As the agency predicted, electricity generation from natural gas has nearly tripled. But the EIA expected this shift to be driven primarily by the switch to cheaper and more efficient natural gas generators at electric utilities.
But that was only part of the story. What the agency was missing was how much the supply side of the natural gas equation would change. Even in 2001, no one expected how hydraulic fracking would transform the natural gas industry — boosting supply and keeping prices stable. In 2020, fracked natural gas accounted for two-thirds of domestic natural gas production.
The EIA did not anticipate the coal collapse. In 2001, it seemed that America’s reliance on coal for electricity generation was a given. The EIA predicted that coal-fired electricity generation would grow by 27 percent between 2001 and 2020. As we now know, the opposite happened. While natural gas production boomed, the use of coal for electricity generation fell by as much as 60 percent.
What explains the decline of coal? The obvious answer is the rise of natural gas. But that would ignore the role of renewables and changes in aggregate demand for electricity. In 1999, the EIA did not expect non-hydropower to be a significant source of electricity. What growth it did expect, it expected to come from the incineration of biomass and municipal solid waste (we can disregard whether those should be considered “renewable” at all).
Where did wind and sun fit in? This was not the case in the EIA analysis of 2001. The agency expected that wind and sun would produce a rounding error in their analysis, which amounted to only 0.5 percent of US electricity demand in 2020. And at this point, the forecasts were wildly wrong. Wind and solar grew at a record pace after 2000 and grew to meet 12 percent of U.S. electricity demand by 2020. That was twenty times more than the EIA forecast in 2001.
Why was the EIA so behind wind and solar energy?
Why was the EIA so far away? According to her, the high cost of renewable energy would continue to limit the rollout. The agency was unable to foresee any policies in the early 2000s that would give renewables a head start — including solar netting and tax credits for investments to support renewables. Most importantly, however, the agency did not foresee that the price of wind and solar energy would fall much faster than expected, especially as implementation began to scale.
The other interesting projection is the EIAs expectations for total electricity demand. Although the EIA used lower forecasts for electricity demand, based on the adoption of new efficiency standards and the introduction of more efficient equipment, it still expected total electricity demand to increase by 34 percent by 2020. But it turns out that the move to LED bulbs (and many other efficiencies) add up. Total electricity demand grew by only 14 percent.
Put all this together and it reveals one last surprise. In 2001, the EIA projected that CO2 emissions from electricity generation would increase by 28 percent by 2020 to 2.73 billion tons. But the slower growth in electricity demand, the rise of renewables and the shift to natural gas have reduced the CO2 intensity of the electricity sector. In 2020, actual CO2 emissions from electricity were 1.55 billion metric tons – 43 percent lower than what the EIA predicted in 2001. That means US carbon emissions from the electricity sector are lower than they were in 1990, even though electricity production has increased by 33 percent.
What lessons can we draw from the EIA’s energy projections as we anticipate a clean energy transition? The first lesson is how difficult it is to anticipate, let alone predict, the rapid transformation of the electricity sector. That points in the direction of the second lesson. History reminds us that change can happen much faster than anyone expects. And right now, given the urgency of tackling climate change, we need a lot of change.
This post is adapted from James Morton Turner’s upcoming book, Recharged: A History of Batteries and Lessons for a Clean Energy Future (August 2022). You can learn more about Charged Bee http://charged-the-book.com
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