ICF: Gas, Renewables Will Continue to Replace Coal
Business Wire reported on April 1 that ICF Consulting released its 2015 ICForecast Energy Outlook that discusses fuel and energy prices and production levels, as well as the trends and factors that will shape the energy industry. The report provides short, medium and long-term forecasts that extend up to 25 years into the future.
Regulations – The Environmental Protection Agency (EPA) plans to finalize its Clean Power Plan (CPP) rules this summer, which will have an enormous impact on the future of the power sector. Furthermore, the Supreme Court will rule on the EPA’s Mercury and Air Toxics Standards soon. If the rule stands, it could force many owners of coal-based power plants to choose between making expensive upgrades or mothballing their facilities. In turn, this could lead to higher retail electricity prices in regions that are reliant on coal.
Generation Mix – Wholesale (Henry Hub) natural gas prices have been steady this winter. With production continuing to increase, prices may continue to decline for the next 12 to 24 months. Regardless, the share of US electricity generation from natural gas will increase from 29 percent today to 38 percent by 2030. Coal consumption will be relatively steady through 2025, despite the retirement of 60 GW of coal capacity. State renewable portfolio standards will drive growth in wind capacity, despite the expiration of the Production Tax Credit. Meanwhile, falling solar installation prices and strong state and federal incentives will drive rapid solar growth in the short term.
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