- “Renewables plus storage, already demonstrably cleaner, are now increasingly, also cheaper. It is a combination that will be hard, if not impossible, for coal to beat”. Dennis Wamsted, analyst and editor of the Institute for Energy Economics and Financial Analysis
In a recent article written by Dennis Wamsted analyst and editor of the Institute for Energy Economics and Financial Analysis a harsh new reality is undermining the U.S. coal-fired electricity sector: Cleaner generation by way of utility-scale solar backed with storage is an increasingly cheaper option for utility companies than continuing to operate aging coal plants.
The most recent—and perhaps most detailed—example of this new paradigm can be seen in ongoing long-term resource planning by PacifiCorp, the Berkshire Hathaway Energy subsidiary that provides electricity to about 1.8 million customers in six western states (California, Idaho, Oregon, Utah, Washington and Wyoming). A telling analysis released by the company in late April points to an inescapable conclusion: Closing existing coal plants and replacing them with renewable capacity makes economic sense because it would save hundreds of millions of dollars.
The review plays out the effects of retiring various plants early, in 2023, either individually or in combination. Benefits to early coal plant closures were found in seven out of ten scenarios.
For PacifiCorp and the coal-generation sector, in general, the findings around two of their coal fired plants, Naughton and Bridger especially underscore a worrisome trend. In the past five years, the two Naughton units have posted an average capacity factor of more than 87% and the Bridger units have been above 64%. The problem—and it’s a big one—is that even at those performance levels, the units can’t compete with cheaper and cleaner alternatives.
The price declines for wind and solar generation during those same five years have been significant. And similar sharp declines in battery storage have occurred more recently, making it increasingly economic to pair variable renewables with storage at lower cost than existing coal-fired generation.
Author: GBA News Desk