Friday, May 15, 2009

New Electric Capacity: Wind and Gas Move to the Top of the Class

New U.S. electric generating capacity by fuel type in 2008 indicates that wind power is the most popular form of additional generation among U.S. shareholder-owned electric utilities.

According to the "EEI 2008 Financial Review," by the Edison Electric Institute, a trade organization of investor-owned electric utilities, newly announced wind capacity totaled 4,914 megawatts, gas totaled 3,868 megawatts, and hydro totaled 2,409 megawatts. Where was coal? Dead last among six categories at a paltry 68 megawatts.

This hardly means that coal is out of the picture -- in fact, the EEI report says that in 2008 coal accounted for 48.5 percent of total electric output in the U.S. versus 52.8 percent 10 years ago. And the report notes that coal "is expected to remain the nation's primary generation fuel for the foreseeable future."

However, there are formidable questions on the horizon for coal-fired power. The Economist reports ("The Writing on the Wall," May 7, 2009), that 97 coal-fired power plants have been cancelled or rejected since 2001 while coal plants planned for development have dropped to 60 from 150 in the last five years.

Then there is the issue of a carbon-constrained U.S. economy. EEI says, "The increasing likelihood that Congress will impose a national cap on carbon emissions makes it difficult to confidently predict" total electric output based on coal over the next 20 years. "Coal usage will be shaped by market fundamentals, state and federal greenhouse gas emissions policies, and the availability of cost-effective technologies that capture and sequester GHG emissions from coal-fired facilities," the EEI says.

It is way premature to abandon coal as a primary generation fuel. But it is not to early to be thinking about a steady decline in coal's percentage of total generating capacity.

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