Energy Department: Renewables to Reach 26% of U.S. Generation in 2024

By Christian Roselund

The United States Department of Energy’ Energy Information Administration (EIA) has forecast that the share of U.S. electricity generation from renewable energy will rise from 21% in 2022 to 24% in 2023 and 26% in 2024. This change is driven by wind and solar, which EIA expects to rise to 16% of generation in 2023 and 18% in 2024. EIA published these figures in its Short-Term Energy Outlook on 10 January 2023.

As the share of generation for wind and solar increases, EIA expects the share for both natural gas and coal to fall, with coal declining to only 17% of total generation in 2024. This would represent a continuation of the fall in coal-fired power that has been happening for the past decade. However, the two years of consecutive decline in gas-fired power from 2022 through 2024 would represent a new trend, as the portion of gas-fired generation in the U.S. electricity mix has been climbing for
a decade.

EIA forecasts that other key metrics in the U.S. electricity system will remain stable, with relatively flat electricity usage in 2023 and 2024 and nuclear power continuing to supply 19% of the nation’s electricity through 2024.

EIA expects 2/3 of the new wind and solar generation in 2023 and 2024 to come from utility-scale solar. It bases its forecast on the expectation that the United States will install 32 gigawatts of utility-scale solar in 2023 and another 32 gigawatts in 2024. EIA also expects 9 gigawatts of small-scale solar capacity to be added in 2023 and a further 12 gigawatts in 2024.

However, it is not clear whether EIA has incorporated the effects of U.S. trade policies that have restricted the availability of PV modules in its forecasts. In the second half of 2022, CEA estimates that Customs detained multiple gigawatts of PV modules from at least three major PV makers under the Uyghur Forced Labor Prevention Act (UFLPA). To CEA’s knowledge, the first releases of modules detained under UFLPA were in late November 2022, and a limited number of shipments have been released to date.

Furthermore, beyond the direct market impact of detentions, suppliers have indicated that they are shifting supply to other markets. For example, in its Q3 earnings report, Jinko Solar revealed that it has deferred shipments of 2 gigawatts of modules from the U.S. market due to UFLPA impacts.

Wood Mackenzie cites UFLPA as first among several factors in its estimate that the United States only installed 16 gigawatts of solar in 2022. John Smirnow, SEIA’s general counsel and VP of Market Strategy, recently told UtilityDive that he expects the market to see “hangover effects through 2023” from 2022’s detentions.

Overall, EIA expects a 3% decline in energy-related CO2 emissions in 2023. However, the agency expects energy-related emissions to remain the same in 2024, with increased petroleum usage for fuel offsetting declines in electricity sector emissions.

Source: Short-Term Energy Outlook, January 2023 (EIA)