US energy projections see 'modest' decline

The US is set to become a net energy exporter over the period to 2050, but the nation's nuclear generation will decline over the period as new build and capacity uprates are outpaced by retirements, according to newly published projections from the US Energy Information Administration's (EIA).

The EIA's Annual Energy Outlook 2017 provides modelled projections of US domestic energy markets for different assumptions of macroeconomic growth, world oil prices, technological progress, and energy policies. Eight cases are considered, seven of which - Reference, Low and High Economic Growth, Low and High Oil Price, Low and High Oil and Gas Resource and Technology - assume the implementation of the country's proposed Clean Power Plan. The eighth case takes the same assumptions as the Reference case but without implementation of the Clean Power Plan.

The report projects modest growth in electricity demand, with the retirement of older, less efficient fossil fuel units - largely spurred by the Clean Power Plan - and the near-term availability of renewable energy tax credits as the primary driver for new capacity. "Even if the [clean power plan] is not implemented, low natural gas prices and the tax credits result in natural gas and renewables as the primary sources of new generation capacity," the report notes, adding that the future generation mix is sensitive to the price of natural gas and the growth in electricity demand.

The reference case sees the share of coal in electricity generation decline over time. Wind and solar become the predominant sources of renewable generation, both surpassing hydro.

No new nuclear capacity - beyond that already under construction as of 2017- is added over the projection period in the reference case. The EIA says this is because of the combination of low natural gas prices, higher renewables penetration, low electricity load growth, and "relatively high" capital costs. New capacity additions are limited to those reactors already under construction and uprates at existing reactors.

"Nuclear generation declines modestly over 2017–40 in the Reference case as new builds already being developed and plant uprates nearly offset retirements. The decline in nuclear generation accelerates beyond 2040 as a significant share of existing plants is assumed to be retired at age 60," the report notes.

From 2018 through to 2040, 4.7 GW of additional capacity at existing units is projected to come online, based on an assessment of the remaining potential for uprates. However the period will see a "significant reduction" in nuclear capacity because of retirements, with EIA citing a total of 6.4 GW of announced retirements, plus the projected retirement of 3.0 GW in the period from 2019 to 2020, to address near-term market uncertainty, and about 10.6 GW of long-term retirements in the period to 2040, to address uncertainties in licence renewals. A further 11.7 GW of nuclear capacity is projected to retire by 2050 as plants pass their 60-year licensing milestone.

The EIA projects installed nuclear capacity in 2050 to be 76.5 GW - a 0.8% decrease on today - in five of the eight scenarios, including the reference case both with and without the Clean Power Program. The 75.6 GW figure under the low economic both case gives the same percentage decrease, while under the high oil and gas resource technology case projected nuclear capacity of 63.9 GW is a 1.3% decrease on today. Only under the low oil and gas technology case does nuclear capacity increase from the 2016 value of 99.1 GW to 109.3 GW - an increase of 0.2%.

Declining emissions

Energy-related carbon dioxide emissions decline in most of the scenarios, with a declining share in recent years. The highest emissions were projected for the No Clean Power Plan case.

The Clean Power Plan was introduced by President Barack Obama and the US Environmental Protection Agency in August 2015 in an effort to cut US CO2 emissions by 32% from 2005 levels by 2030. It requires states to develop plans to reduce CO2 emissions from existing generating units that use fossil fuels. Although it allows credit for new nuclear power plants and uprates to existing units, the plan does not credit the role of existing nuclear capacity and does not credit nuclear licence extensions on the same basis as new capacity. The plan was to have been implemented by the end of 2015, but its implementation has been stayed pending a judicial review.

"Combined with lower natural gas prices and the extension of renewable tax credits, the [Clean Power Plan] accelerates a shift toward less carbon-intensive electricity generation," the EIA notes.

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US Energy Secretary Ernest Moniz Moniz and the US Department of Energy today released a Cabinet Exit Memo, outlining the work done by the department under the Obama administration. The 21-page memo sets out the progress made in support of the department's mission to advance the energy, environmental, and nuclear security of the USA.

Researched and written
by World Nuclear News