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Renewable Energy In United States

California is a leading state with around 20 percent of California's electricity coming from renewable sources.

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Definition / Scope

Renewable energy is the energy that comes from resources which are naturally replenished on a human time scale such as sunlight wind, rain, tides, wave and geothermal heat. The sources of renewable energy includes biomass, wind, hydropower, geo-thermal and solar sources. Renewable energy in US Renewable energy in the United States accounted for 12.87 percent of the domestically produced electricity in 2013. California is a leading state and around 20 percent of California's electricity comes from renewable sources

Sun: The sun’s energy can be used to generate power from photovoltaic cells, which convert light directly into electricity. Solar thermal energy is available by transferring energy from the sun via a liquid to heat water or air.

Wind Energy: Wind energy is extracted by wind turbines, situated onshore or offshore. These transfer the momentum of passing air to rotor blades, which is then converted into electricity.

Biomass Energy: Biomass is basically a material derived from growing plants or from animal manure. Biomass includes waste materials such as straw, or crops specifically grown as biomass fuel. Energy can be recovered through combustion of solid material, or of gases generated from the anaerobic fermentation of liquid material.

Hydroelectric Energy: Hydroelectric power is generated from the energy derived from inland water resources such as streams, rivers and lakes.

Tidal Energy: Tidal energy is produced by the rotational energies of the earth, moon and sun, and can be used to generate electrical energy. Electricity can also be generated from waves. Waves receive their energy from the wind.

Geothermal: It is the heat energy contained in rocks beneath the earth’s surface and can be used potentially to produce heat or generate electricity.

Market Overview

As per EIA report, renewable energy in the US is accounted for 12.87 percent of the domestically produced electricity in 2013. California is a leading state with around 20 percent of California's electricity coming from renewable sources.

US Renewable energy consumption:

The total renewable energy consumption is shown in the table below. As per the latest statistics, it can be stated that the demand for hydro and biomass power generation is at its peak. As per EIA assessment, the hydro power generation accounted for 6.2 percent of the total renewable energy in US.

In 2014, slightly more than half of all renewable energy was used to generate electricity. Within the electric power sector, renewable energyaccounted for 13% of energy consumed, higher than its consumption share in any other sector. Hence, there is a need to increase the production from the above sources.i.e.

Hydroelectric power generation in US

Hydropower, the energy produced by moving water, is currently the largest source of renewable electricity in the United States, accounting for around 6.2% of the nation's total electricity in 2010 which was 60.2% of the total renewable power in the U.S. 

Advantages of hydroelectric power:
  • It produces minimal pollution as fuel is not burnt. 
  • Water to run the power plant is provided free by nature
  • It plays a major role in reducing greenhouse gas emissions
  • Relatively low operations and maintenance costs
  • The technology is reliable and proven over time
  • Current trends of hydroelectric power in all the states: 
  • Hydropower represents 19% of total electricity production. As per the below statistics, we can state that hydroelectric power generation is very important for the country’s overall development.
Limitations to hydroelectric power generation:
  • Hydropower production depends on availability of water which may vary significantly from year to year. Annual year-to-year variance in hydropower generation affects the overall contribution of renewable energy to the U.S. generation mix. 
  • Annual weather and precipitation cycles affect hydropower production. The hydroelectric resource potential depends on a combination of rainwater draining directly into waterways and the accumulated snow in mountainous regions that eventually melts. 
  • In addition to the above, it requires lot of land for construction of dam, reservoir. It requires huge initial investment and long gestation period. It also requires perennial availability of water. 

Biomass Power generation

The contribution of biomass power generation is second only to that of hydropower among the renewables to the national energy supply. According to the survey, more coal-fired power plants are converted to either 100% biomass fueled plants or cogeneration plants that are partially powered by biomass stock. Power generation through biomass came into existence in the recent days. 

Today, independent biomass power generators supplies around 11 billion kWh/yr to the national power grid and disposes around 22 million tons/yr of solid waste. There are around 250 biomass power plants in US, of which California is highest.

Limitations of Biomass power generation:

It is very expensive as biomass is a low-density fuel, so fuel production, handling, and transportation are more expensive.

Biomass is dispersed throughout the country due to which the power generating facilities tend to be small, so they cannot capture the economies of scale typical of fossil fuel-fired generating facilities.

In addition to the above, due to the waste disposal of the leftover residue, the biomass power generations is not environment friendly and also emit greenhouse gases.

Wind power generation:

Wind power generation is one of the major contributors to the US power generation. According to the recent statistics by American WindEnergy Association (shown in the table below), the electricity generated through wind turbines almost tripled since 2008.  

Among all the states in US, Texas generates considerable electricity from wind energy i.e. over 35.9 million megawatt-hours, which is equivalent to power 3.3 million homes. ERCOT, the main electric grid in Texas, received 9.9 percent of its electrical generation from wind energy during 2013. The construction of 7,000 MW of new capacity is underway. North Dakota is a major wind producer, generating 12 percent of its energy from wind.

Although wind power generation is one of the major sources of all the renewable energy sources, it has few limitations.

Limitations of Wind power generation:

Wind is unpredictable and its availability is not constant. Hence, it is not well suited as the base load energy source.

The wind power generations requires higher initial investment than fossil fueled generators.  

The turbine wild life may damage local wildlife such as bird.

Solar power generation

In view of the wind power limitations, solar power is considered as the next option to the household energy requirements. According to a study, there are over 20,000 MW of cumulative solar electric capacity operating in the US which is enough to power more than 4 million homes on an average.

Among all the states in US, Nevada has the greatest solar energy resources and has abundant wind and geothermal energy. Developing Nevada's own energy resources could also be powerful tool for economic development, especially in rural areas.  Nevada's renewable energy standard requires utilities to generate 6 percent of their power from solar energy by 2016.

The US solar industry has seen a major surge by installing nearly 7000 MW electric capacity in 2014, which is 34% more when compared to 2013. 

The amount of solar power installed in the US has increased from 1.2 gigawatts (GW) in 2008 to an estimated 17.5 GW as of the end of the third quarter of 2014. 

Advantages of Solar Power generation:

It helps fortune 500 companies in saving money as major US corporations including Walmart, Ikea etc have installed solar systems. As per the study, the top 25 corporate solar users in US have installed more than 569 MW of capacity at 1,100 different facilities across the country as of August 2014. 

It is beneficial to the economy.  here are nearly 174 000 solar workers in US which is more than 20% increase over employment in 2013.

Geothermal Power Generation

 The geothermal power generation has increased drastically in the year 2014. As per the survey, the country has about 1,250 MW of power under development with about 500 MW stalled in Phase 3 waiting for power purchase agreements (PPAs). Many projects are pending as they require tax credits approval by the US government. It is expected that these projects could start their production by 2017.  

According to the survey, the country has built over 38 geothermal power projects adding nearly 700 MW to the US electricity capacity. 

There are three technologies in power production through geothermal sources. They are dry steam, flash and binary. The type of the technology used depends upon the characteristics of the geothermal resources. Binary plants are used with lower temperature resources while flash and dry steam plants are used with higher temperature resources. Of the three technologies, Flash and dry steam are more prevalent in the recent days.    

Key Metrics

Metrics Value Explanation
Base Year 2016 Researched through internet

Strategic Conclusion

From the above discussion, it can be seen that the demand for power generation through renewable sources increasing in view of the increasing population and to supply to their day to day needs. 

In order to select the best renewable resource for the power generation there is a tool called Levelized cost of electricity (LCOE). It is a convenient summary measure of the overall competiveness of different generating technologies. It represents the per-kilowatthour cost of building and operating a generating plant over an assumed financial life and duty cycle.  

The key inputs in calculating LCOE include capital costs, fuel costs, fixed and variable operations and maintenance (O&M) costs, financing costs, and an assumed utilization rate for each plant type. The importance of the factors varies among the technologies. For technologies such as solar and wind generation that have no fuel costs and relatively small variable O&M costs, LCOE changes in rough proportion to the estimated capital cost of generation capacity.  

For technologies with significant fuel cost, both fuel cost and overnight cost estimates significantly affect LCOE. The availability of various incentives, including state or federal tax credits, can also impact the calculation of LCOE. The value of all these factors varies regionally. 

All the renewable sources have got few limitations. Based upon the above facts, we can see that the power generation through hydroelectric, solar and wind can be considered as the better possible option, depending upon the geographical location. For example Nevada has the maximum sunshine when compared to other states. It is estimated that there are around 250 sunshine days in a year. Hence solar can be considered as the better option in this state.



MW – Mega watt

MWh – Megawatt hour

KW – Kilo watt hour

MMW – Million Megawatt

US – United States

EIA - Energy Informatio administration

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