L R AS Published on Sunday 27 September 2020 - n° 333 - Categories:the American PV, various USA
U.S. utilities keep their coal or gas-fired power plants
How will the United States remove 236 GW of coal-fired and 1,000 advanced gas-fired power plants currently in operation?
It is well known that RE electricity is now cheaper than coal or peak gas-fired power plants, but the latter are still in operation,
and to make them disappear, you need good motives.
85 GW of coal-fired plants have been shut down since 2007. The pace of closures appears to be accelerating as 31 GW have been retired since the beginning of 2018. This has led to a 30% drop in US coal-fired power generation in the first six months of 2020. Electricity from renewables increased by 5% in the first half of 2020. Thus, the real beneficiary of the decline in coal was natural gas-fired power generation, which increased by 9% in the Americas in the first half of the year, according to the IEA.
The IEA says coal-fired power plants are simply "uneconomic in most regions" because of the low cost of renewables and falling spot prices for natural gas. Yet 236 GW of coal capacity is still operating in the United States.
Yet there is a trend to favour solar + storage over gas-fired power plants.
According to Rocky Mountain, retiring unprofitable units among the 236 GW in operation would save $10 billion. Closing the 236 GW would save an additional $9 billion. But power companies cannot abandon the assets of more than 1,000 gas units for peak demand and 236 GW of coal capacity without a different regulatory and financial structure. That's why the study recommends that the government fund this transition so that the savings go to the consumer. Only many power companies prefer to keep their coal or gas-fired plants.
The reasons for the status quo are said to be related to prejudices about oversupply of capacity and the advantage of self-sustaining, manageable generation. In addition, there is the corporate culture of the companies and the design of tariffs that favour gas-fired generation. However, some companies are ready to bet on new energies and on storage, as in California.
PV Magazine of 21 September
Editor's note Cultural resistance is well described in this article. We prefer to keep what we know rather than move on to something we don't know.
