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Forbes: 4 Reasons Renewables Will Continue to Dominate Fossil Fuels

Posted by Jeff McMahon on Jul 3, 2019
Forbes columnist Jeff McMahon highlighted the competitive economics of renewables in this second piece drawing from AEE's June 25 webinar, "What Happens When Wind and Solar Compete on Price." He reports that renewables make running fossil fuel plants more expensive, costs of capital are declining, renewables have no fuel costs, and they compete in states like Georgia, Indiana, and North Carolina. See excerpts below and read the entire Forbes piece here. McMahon's first piece is here.
 

Renewables will dominate energy markets in the United States because of their economics, even without the support of policy, some analysts agree.

The low price of renewables has driven the news this week not only of LA's record-breaking solar+storage deal but also Indiana's early exit from coal. And experts expect prices to continue to fall across the country...

“Solar in the range of 2 to 4 cents is basically going to be available everywhere in 2025, with some uncertainty as to how fast costs will come down. But our research and the research of NREL suggest that cost decline is going to continue regardless of federal tax support,” [said Mike O'Boyle, director of electricity policy for the think tank Energy Innovation.]
 
The cost of renewable energy will continue to decline, according to O'Boyle and other panelists in an Advanced Energy Economy webinar last week, largely because of four economic factors that inherently favor renewables...
 
Ron Lehr, former chairman, Colorado Public Utilities Commission: "As more wind and solar get added to the system, fossil units get ramped more and used less, so that’s going to drive up their per-unit cost."
 
Matt Langley, vice president of Pattern Energy: "As those generators get pushed off, their ramping gets more expensive, they can’t compete with our rates, so they end up mothballing or retiring. That frees up additional demand that those guys were serving that we can serve. It creates something of a virtuous loop. And that really is the most exciting part of this: as our velocity increases, the acceleration of the adoption also increases, primarily in my view because we are the most economic resource in most of the United States..."
 

Indiana isn't the only red state taking advantage of renewable resources. The Southeastern United States has abundant sun and wind, but many of those states have long-standing commitments to coal that will increasingly seem costly and wasteful...

"...I think as these economic numbers become better understood…. those markets will open up. It’s already happening in Georgia and North Carolina, and I think that trend will continue," [said Langley.]

Read the entire Forbes piece here. McMahon's first piece is here

Topics: AEE In The News