Decarbonization and Rising Renewable Energy Sources Key to Energy Transition
The fight against global warming requires a purposeful energy transition from fossil-based energy towards renewable power sources throughout the worldwide energy sector. In the United States, local municipalities like New York City are also looking to reduce the use of coal, oil, and gas in favor of clean energy to meet sustainability goals. NYC, for example, hopes to reach 70% renewable energy by 2030 and zero-emissions electricity by 2040.
As part of this energy transition, New York also implemented the Peaker Rule, which requires fossil fuel generators, specifically “peaker plants,” to meet stricter regulations on smog-forming pollutants starting in 2023. These plants, often located within electrical demand-heavy areas in New York City and Long Island, are used during high electricity demand or “peak” times. In their place, the city is looking to add clean energy hubs.
So what is the energy transition outlook in the state and across the country? Below we highlight some ways the energy sector is moving from fossil fuels to renewables and some challenges faced along the way.
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The Downtrend in Fossil Fuel Energy Production
To reduce carbon emissions, we must reduce our reliance on the fossil fuels responsible for the majority of greenhouse gases. Throughout the United States, the make-up of our electricity generation (often called our “grid mix”) is changing. As an example, coal-fired generation has fallen by 68% between 2010 and 2020.
Pennsylvania, at the heart of coal country, is an excellent microcosm of the global energy transition. Its biggest power plant, Homer City, is set to close in July due to economic stress and environmental regulations. All five remaining Pennsylvania power plants are set to close by 2028.
A Growing Source of Renewable Energy
As we move away from fossil-fuel production, renewable energy sources like hydroelectric, solar, and wind offer green alternatives for us to move toward.
The Champlain Hudson Power Express is the first of two projects constructed in New York as part of the groundbreaking renewable energy and transmission initiative known as Tier 4. It is set to provide 1,250 megawatts of clean hydroelectric power—enough to supply more than a million households—and is projected to decrease carbon emissions by 37 million metric tons throughout the state. This amount is equivalent to removing more than 500,000 vehicles from the road annually.
To address New York’s Peaker Rule directly, the NYPSC has given the go-ahead for Con Ed’s Clean Energy Hub in Brooklyn at the cost of $800 million, a small fraction of its expected $60 billion expenditure for sustainable energy. The strategically located hub will interconnect up to 1,500 MW of offshore wind energy, providing the city with low-cost renewable power.
Meanwhile, a new hydropower transmission line is coming through Maine to combat climate change by supplying up to 1,200 megawatts of Canadian hydropower to the New England power grid, providing enough electricity for about 1 million homes.
The Obstacles to a Smooth Energy Transition
There are still significant challenges to transition towards a more sustainable energy mix.
For example, enforcing the Peaker Rule, which imposes stricter environmental regulations on fossil fuel power plants, may reduce available capacity during peak demand periods in the summer. The city’s utilities will need more generation capacity to meet that demand, underscoring the importance of careful planning for alternative, clean sources of energy and energy storage solutions to maintain reliability in the grid.
Another major obstacle is the lengthy bureaucratic approval process for new energy projects.
An interconnection queue manages new renewable energy projects that wish to connect to the electricity grid. Each project in the queue undergoes multiple studies to evaluate its potential impact on grid stability, reliability, and efficiency.
Delays are common and can last for years, creating a significant challenge for developers. In fact, due to these interconnection queues, more renewable energy capacity is waiting to be built and connected to the grid than the total already installed across all resource types.
Additionally, these projects face challenges in obtaining permits, especially in ecologically sensitive areas. Overcoming these obstacles to deployment requires significant investment in grid infrastructure, the streamlining of the regulatory process, and the involvement of all stakeholders, including policymakers, communities, and investors.
How can you best manage the energy transition? Contact our reputable energy consultants. They can provide valuable insights into procuring and implementing renewable energy sources and improving energy efficiency. Call us or fill out our contact form to get started on a professional energy management strategy.