The Evolving U.S. Energy Mix: What Fuels Electricity Use in America and How is that Mix of Fuels Changing?

By February 17, 2019Green Energy

The electricity sector in the United States has been undergoing a massive transformation recently. Coal plants and nuclear plants are closing, natural gas plants and renewable energy sources are being built at a rapid pace, and the resultant energy mix in the U.S. grid has reflected this constant push and pull of economic, environmental, and technological forces.

Keeping track of these developments might seem intimidating, but luckily for those of us keeping an eye on electricity trends the U.S. Energy Information Administration (EIA) tracks and reports all the critical data for us. EIA is a policy-neutral wing of the U.S. Department of Energy and offers many regular reports on the state of the energy industry. Most critical to keep tabs on the U.S. power sector, though, are the Electric Power Monthly (released monthly), Short-Term Energy Outlook (released monthly), and the Annual Energy Outlook (released yearly). The Electricity Data Browser also provides very user-friendly data tables and graphs.

By digging through these freely and publicly available datasets (or reading EIA’s accompanying narrative reports), anyone can get a clearer picture on what fuels electricity generation in the United States. As an example, let’s dig into two of the most significant overall trends of recent and upcoming years…

Downward trend of coal

For the past few decades, the electricity generation sector in the United States was by and large run by coal. While there were always other energy sources fueling the electric power generators, such as natural gas, oil, renewable energy, and nuclear, coal was king. However, coal’s reputation as a dirty fuel, both in terms of contributing towards climate change and the air pollution it delivers to regions with coal plants, has been a detriment to the fuel, not to mention it used to wear the crown as the cheapest fuel source out there but has definitively lost that edge.

Using EIA’s data, we can see that coal’s dominance as the largest contributor to electricity generation stretched back decades, but only recently did it start to get challenged by natural gas generation. This rise in natural gas can be attributed to the vast amount of gas that’s been found underground in the United States recently that is newly accessible thanks to rapid advancements in drilling and hydraulic fracturing. This influx of natural gas has allowed the United States to quickly become competitive with (and, soon enough, be even cheaper than) coal.

Combine that fact with the realization that natural gas contributes less than half of the carbon dioxide emissions per unit of energy as coal and you have a recipe for a landscape-altering shift. As government policies to tax or otherwise price carbon dioxide emissions continue to get proposed and debated, electricity generation from coal only looks to be at greater relative risk in prices due to the carbon intensity of the fossil fuel. However, for customers purchasing electricity– whether residential, commercial, or industrial– this trend is a positive one as the influx of new fuels in lieu of coal will continue to provide stable and affordable prices, not to mention the public health benefits of living in areas where coal plants are not as prevalent.

The rising tides of carbon-free generation

Beyond the jockeying for the top fuel between coal and natural gas, nuclear and renewable energy are also worth noting. While nuclear power has long contributed about 20% of U.S. energy mix, renewable energy sources have been gaining rapidly in recent years. Due to a variety of factors, including government tax incentives, quickly improving technologies and decreasing installation costs, and a general global push to implement more carbon-neutral sources, renewable energy is poised to pass nuclear to become the third most prominent electricity source in the United States. Within the world of renewable energy, there’s also been a changing of the guard as wind has recently become the renewable energy source with the greatest generation capacity and energy generated. Hydropower has long been a stalwart of renewable generation, and it remains likely to continue producing at its current level, but rapidly dropping costs and increased environmental interest in wind energy have continued to push the renewable generation from wind farms up at an incredibly rapid pace to become the largest source of renewable energy in the United States.

Beyond renewable energy, nuclear has always been a significant source of carbon-neutral electricity generation in the United States. While the traditional nuclear energy generation sector of the United States has largely stalled, seeing only retirements in the past few years and just a single (and oft-delayed) nuclear construction project in the works, the nuclear power sector has also started stepping into the localized energy generation concept with the advancement of modular nuclear reactor designs. These deployable nuclear reactors can theoretically be built in a factory and shipped directly to a site to provide a much smaller amount of electricity to a locality than traditional nuclear generating stations, but it can do so with a much lower level of upfront capital costs.

Not only do these carbon-neutral trends achieve stability and low-cost electricity for consumers, but the proliferation of renewable energy sources enables even more localized solutions for energy procurement. Renewable energy solutions are becoming more prominent on private properties for local generation directly for residential and commercial customers, not to mention towns and communities installing renewable energy sources connected to local microgrids that are able to operate independently of the traditional and larger grid system. These types of changes do even more for a customer’s power reliability because extreme weather and disasters are less likely to leave a locality without power for extended periods of time if they’ve invested in such distributed energy resources.

Tracking the data yourself

Luckily for all consumers of electricity, the EIA dataset is constantly updated and allows the curious to keep track of developments in this landscape of U.S. power generation. The story will continue to evolve, but this evolution looks to be great news for all customers seeking affordable and reliable energy for their homes and businesses.

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