Renewables, not natural gas, were main driver behind drop in U.S. power sector emissions in 2017

Coal-to-gas switching spurred emissions reductions in prior years.

Solar panels and wind turbines with the San Jacinto Mountains in the background. CREDIT: Connie J. Spinardi/Getty Images
Solar panels and wind turbines with the San Jacinto Mountains in the background. CREDIT: Connie J. Spinardi/Getty Images

The growth of clean energy in 2017 was one for the record books: Last year was the first time a reduction in U.S. power sector carbon emissions could be attributed more to renewable energy and energy conservation than the nation switching from coal to natural gas to generate electricity.

Carbon emissions from the power sector dropped 4.2 percent in 2017, this time on the back of declining load and greater renewable generation, according to a new report from Bloomberg New Energy Finance (BNEF). In 2016, switching from coal to natural gas for power generation was the primary driver of the 5.8 percent downturn in carbon emissions.

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Power-sector emissions are also declining compared to other parts of the U.S. economy. For decades, the power sector had been the nation’s biggest source of carbon emissions. But as emissions from the electricity sector plummeted again in 2017, transportation retained its place as the largest carbon-emitting sector for the second year in a row, BNEF researchers wrote in the 2018 edition of the “Sustainable Energy in America Factbook.” BNEF produced the publication for the Business Council for Sustainable Energy.

With the near-record deployment of renewable energy resources across the country, U.S. greenhouse gas emissions hit a 25-year low in 2017. Power-sector emissions now sit 28 percent below their 2005 peak, which puts the U.S. only 4 percentage points away from achieving its former Clean Power Plan target of 32 percent below 2005 levels by 2030, according to BNEF. The rapid emissions reduction also helped to bring the nation halfway to its Paris climate agreement target of slashing economy-wide emissions to 26 percent below 2005 levels by 2025.

Last summer, President Donald Trump announced that the United States would initiate the formal process to withdraw from the Paris agreement. In response to the proposed withdrawal from Paris and fading federal-level climate action, sub-national actors have created alliances to support continued progress on U.S. greenhouse gas reduction targets.

The most recent “State of Green Business Report” noted that 71 Fortune 100 companies have a public target for renewable energy. Of those companies, 21 have committed to using 100 percent renewable energy, Andy Bilich, a clean energy analyst for the Environmental Defense Fund, wrote in a blog post about the BNEF report.

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“Despite attempts by the Trump administration and the coal industry to limit clean energy in favor of fossil fuels — including a tariff on solar energy, a thinly disguised bailout for coal and nuclear power plants (that was rightly rejected), and a dramatic proposed cut to energy research — we are accelerating the transition to a cleaner electric grid,” Bilich said.

Renewable energy generation, including hydropower, climbed 14 percent to an estimated 717 terawatt hours in 2017, from 628 terawatt hours in 2016. The growth brought renewables to 18 percent of total U.S. generation, double their contribution a decade ago.

Renewables set new highs in 2017 due to a rebound in hydropower as reservoir levels on the West Coast recovered after a prolonged drought. Also, the large number of wind and solar projects built in 2016 had their first full year of operation in 2017, boosting non-hydro renewable energy generation by 15 percent to 413 terawatt hours, according to BNEF.

Cost also is contributing to the rapid growth of wind and solar energy. According to a separate study released late last year, building and running new renewable energy is now cheaper than just running existing coal and nuclear plants in many areas.

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A widely-used yearly benchmarking study — the Levelized Cost of Energy Analysis (LCOE) from the financial firm Lazard Ltd. — reached this conclusion: In many regions “the full-lifecycle costs of building and operating renewables-based projects have dropped below the operating costs alone of conventional generation technologies such as coal or nuclear.”

According to BNEF, renewables’ rise in 2017 came as natural gas-fired generation decreased by an estimated 8.1 percent. Natural gas’ share of total U.S. generation dropped from 34 percent in 2016 to 32 percent in 2017. Higher natural gas prices may have also contributed to the decline in natural gas-fired generation, BNEF said.

Natural gas, though, retained its position in 2017 as the top producer of electricity in the United States. After decades of dominance by coal, natural gas surpassed coal for the first time in 2016 — providing 34 percent of total electricity generation — to become the leading generation source.