New Energy Economics Is Beating NatGas

Clean Energy Is Canceling Gas Plants

Molly Keleher, Mark Dyson, Alex Engel, September 30, 2020 (Rocky Mountain Institute)

“…As of mid-2020, power plant projects planned for construction in two of the most competitive US electricity markets (ERCOT in Texas and PJM in the Northeast) have shown a remarkable shift from gas to clean energy…[T]his success needs to be replicated across the country to bring the electricity sector’s emissions trajectory in line with pathways to avoid the worst effects of climate change…[Since 2018,] the clean energy queue has more than doubled, the gas queue has been cut in half, with over $30 billion worth of gas projects canceled or otherwise abandoned…

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…[It is likely a] fundamental driver is at play: raw economics, driven by the continually falling costs of clean energy and the associated risks of investment in new gas-fired capacity…And the benchmark costs of clean energy have fallen meaningfully in the past year…[If cost and efficiency improvements for clean energy continue,] 90 percent of planned combined-cycle capacity will face stranded cost risk by 2026. For many gas-fired plants, this could mean that they are already stranded assets the day they enter service…Fair competition between resources in restructured markets, and emerging best practices around all-source procurement in monopoly markets, can allow clean energy to compete to its fullest potential…” click here for more

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