A February 2023 Morgan Stanley report says renewable energy will replace coal-fired power plants by 2033, reports Power magazine.
“The report published Feb. 1 said renewable energy such as solar and wind power will provide nearly 40% of U.S. electricity in 2030, and as much as 55% in 2035,” the Power article says. “The U.S. Energy Information Administration said coal-fired generation, which supplied about 20% of U.S. electricity last year, will rise slightly this year to provide about 22% of the nation’s power mix, mainly due to higher prices for natural gas. But that jump will be short-lived, with Morgan Stanley saying the 2021 rise in coal use will experience ‘a constant decline thereafter.’”
Coal use for power generation is already on the decline due to lower prices for natural gas and more stringent environmental regulations. According to The Hill, coal supplied 46% of U.S. energy in 2010 compared with 20% of electricity generation a decade later. “Meanwhile, the share of electricity supplied by natural gas-fired power plants increased from 23 percent in 2010 to an estimated 39 percent last year. The projection from Morgan Stanley comes as President Biden has taken a series of executive actions to shift the nation’s priorities to focus on climate. His administration has set a goal of making the U.S. carbon neutral by 2050, which will require steep reductions in greenhouse gas emissions and investments in renewables like solar and wind.”
The most recent coal-fired plant closure was announced on February 2, 2023, when Alliant Energy pronounced the closure of Columbia Energy Center in Columbia County, Wisconsin, by the end of 2024, Power continues.
“Andrew Bradford, principal of Colorado-based BTU Analytics, said that ending coal-fired generation in the U.S. by 2033 ‘is aggressive, as coal retirement announcements would need to climb steeply from current levels to hit that target,’” adds Power. “Bradford, whose group tracks several energy sectors, including power generation and oil and gas exploration, said his company’s data shows the U.S. has 236 GW of coal-fired generation capacity in its fleet, across 267 plants, as of the fourth quarter of 2020. Bradford said ‘102 of those plants have announced retirement formally according to our analysis, summing to 86.2 GW of capacity.’”
Federal, state, and local governments encourage investing in and using renewable energy sources. According to the U.S. Energy Information Administration (EIA), an overview of major programs and incentives available in the United States includes:
- Government financial incentives: Federal tax incentives, or credits, for qualifying renewable energy projects and equipment include the Renewable Electricity Production Tax Credit (PTC), the Investment Tax Credit (ITC), the Residential Energy Credit, and the Modified Accelerated Cost-Recovery System (MACRS). Grant and loan programs may be available from several government agencies, including the U.S. Department of Agriculture, the U.S. Department of Energy (DOE), and the U.S. Department of the Interior (DOI). Most states also provide financial incentives to encourage renewable energy production and use.
- Renewable portfolio standards (RPSs) or goals typically require that a percentage of the electric power sales in a state come from renewable energy sources. Some states have specific requirements, and some have voluntary goals, within a specified time frame, for the share of electricity generation or sales in a state that come from renewable energy. Compliance with RPS policies may require or allow utilities to trade renewable energy certificates or credits (RECs).
- RECs: Financial products are available for sale, purchase, or trade that allow a purchaser to pay for renewable energy production without directly producing or purchasing the renewable energy. The most widely available products are RECs. These products may also be called green tags, green energy certificates, or tradeable renewable certificates, depending on the entity that markets them. Electric utilities can use RECs to comply with state renewable energy portfolio standards. Many companies use RECs or similar products to meet their voluntary targets or goals to reduce greenhouse gas emissions in their operations.
- Feed-in tariffs (FITs): Several states and individual electric utilities have established special rates for purchasing electricity from certain types of renewable energy systems. These rates, sometimes known as FITs, are generally higher than electricity rates otherwise available to the generator. FITs are intended to encourage new projects for specific types of renewable energy technologies.
- Consumer options for purchasing electricity generated with renewable energy sources: For consumers who want to purchase electricity solely produced with renewable energy, many states have the option to choose electricity providers, and some of the participating electricity providers may sell electricity specifically generated with renewable energy. Availability of these programs depend upon state regulations for retail electric power markets. Consumers can also voluntarily purchase green power, even if retail electricity choice is not available. Most of these voluntary programs generally involve contractual accounting for renewable electricity generation rather than the physical or contractual delivery of the electricity to the customer or utility.
- Biofuels and other fuels for vehicles: Several federal and state requirements and incentives are in effect for producing, selling, and using biofuels and other alternative vehicle fuels. Federal law requires the use of biofuels, or qualifying substitutes, in the U.S. transportation fuel supply. The EPA sets annual volume requirements for these fuels, and other federal programs provide financial support for biofuels producers. Many states also have their own programs that support or promote biofuels. The DOE’s Alternative Fuel Data Center is a source of information for these types of programs.
- Renewables research and development: The DOE and other federal government agencies fund research and development for renewable energy technologies. The DOE’s national laboratories carry out or manage most of this research and development in collaboration with academic institutions and private companies. The availability of these programs depends on annual appropriations from the U.S. Congress.
For more comprehensive information about government incentives for renewable energy, see the Database of State Incentives for Renewables & Efficiency® (DSIRE).