US renewables set for record year in 2015, says BNEF

Booming renewable energy deployment, the shuttering of coal-fired generation and increased natural gas consumption will combine to make 2015 a “watershed” year for decarbonisation of the US power sector, according to Bloomberg New Energy Finance (BNEF).

US renewables deployment in 2015 will hit a record 18GW, with solar leading the way at an all-time high of 9.1GW, BNEF has forecast, closely followed by wind with 8.9GW.

In parallel, BNEF said 2015 would be a record year for coal retirements, with 23GW expected to come offline in the US this year, around 7% of the country’s coal capacity.

And the US is expected to burn more natural gas then before in 2015 as a result of low prices.

BNEF said the confluence of these factors would result in 2015 CO₂ emissions from the power sector ending up 15.4% lower than 2005 levels. The country is targeting a 28% cut all its CO₂ emissions by 28% relative to 2005 levels by 2030.

"More interesting than the single-year drop in emissions are the ‘structural’ impacts that will live on for decades,” said William Nelson, head of North American analysis. “Emissions can rise or fall year to year based on weather anomalies and volatile fuel prices – but in 2015, we’ll take a giant, permanent step towards decarbonising our entire fleet of power plants.”

According to BNEF half of the 9.1GW of solar expected this year will be built in California, where a handful of mega-projects are due for completion. This will be bolstered by a wave of “baby ground mounts”, projects in the 1-10MW that BNEF also believe offer the US solar sector the most promising future prospects. Residential rooftop solar is expected to hit 1.9GW this year and commercial rooftop 1.6GW.

The BNEF report said 2016 could see similar levels of new solar and wind capacity built as developers rush to complete projects ahead of the expected cuts in federal tax credits. But this in turn could mean the decarbonisation expected this year will not be repeated.

“Decarbonisation will continue post-2015,” Nelson said, “but at a slower pace. We may never again see 23GW of coal capacity retire in a single year; and renewable build could drop significantly in 2017, when important federal tax incentives step down or expire”.