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Last Updated: September 17, 2020
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According to 2018 data from the U.S. Energy Information Administration (EIA) for newly constructed utility-scale electric generators in the United States, annual capacity-weighted average construction costs for solar photovoltaic systems and onshore wind turbines have continued to decrease. Natural gas generator costs also decreased slightly in 2018.

From 2013 to 2018, costs for solar fell 50%, costs for wind fell 27%, and costs for natural gas fell 13%. Together, these three generation technologies accounted for more than 98% of total capacity added to the electricity grid in the United States in 2018. Investment in U.S. electric-generating capacity in 2018 increased by 9.3% from 2017, driven by natural gas capacity additions.

Solar
The average construction cost for solar photovoltaic generators is higher than wind and natural gas generators on a dollar-per-kilowatt basis, although the gap is narrowing as the cost of solar falls rapidly. From 2017 to 2018, the average construction cost of solar in the United States fell 21% to $1,848 per kilowatt (kW). The decrease was driven by falling costs for crystalline silicon fixed-tilt panels, which were at their lowest average construction cost of $1,767 per kW in 2018.

Crystalline silicon fixed-tilt panels—which accounted for more than one-third of the solar capacity added in the United States in 2018, at 1.7 gigawatts (GW)—had the second-highest share of solar capacity additions by technology. Crystalline silicon axis-based tracking panels had the highest share, with 2.0 GW (41% of total solar capacity additions) of added generating capacity at an average cost of $1,834 per kW.

average construction costs for solar photovoltaic electricity generators

Source: U.S. Energy Information Administration, Electric Generator Construction Costs and Annual Electric Generator Inventory

Wind
Total U.S. wind capacity additions increased 18% from 2017 to 2018 as the average construction cost for wind turbines dropped 16% to $1,382 per kW. All wind farm size classes had lower average construction costs in 2018. The largest decreases were at wind farms with 1 megawatt (MW) to 25 MW of capacity; construction costs at these farms decreased by 22.6% to $1,790 per kW.

average construction costs for wind farms

Source: U.S. Energy Information Administration, Electric Generator Construction Costs and Annual Electric Generator Inventory

Natural gas
Compared with other generation technologies, natural gas technologies received the highest U.S. investment in 2018, accounting for 46% of total capacity additions for all energy sources. Growth in natural gas electric-generating capacity was led by significant additions in new capacity from combined-cycle facilities, which almost doubled the previous year’s additions for that technology. Combined-cycle technology construction costs dropped by 4% in 2018 to $858 per kW.

average construction costs for natural gas-fired electricity generators

Source: U.S. Energy Information Administration, Electric Generator Construction Costs and Annual Electric Generator Inventory

generation electricity natural gas wind solar
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EIA projects that energy-related carbon dioxide emissions will rise over the next 30 years

In our International Energy Outlook 2021, we project that global energy-related carbon dioxide (CO2) emissions will increase for countries both inside and outside of the Organization for Economic Cooperation and Development (OECD) over the next 30 years under current laws and regulations. Between 2020 and 2050, we project that total energy-related CO2 emissions will increase by 5% (600 million metric tons) in OECD countries (which generally have slowly growing economies) and by 35% (8 billion metric tons) in non-OECD countries (which generally have rapidly growing economies).

We project that carbon intensity, measured as emissions per unit of primary energy consumption, will decrease in both OECD and non-OECD countries through 2050. A region’s fuel mix largely determines its carbon intensity, and our projection of carbon intensity decreases around the world as use of renewable energy grows and use of coal is reduced in many countries. We project average aggregate carbon intensity in non-OECD countries to be higher than in the OECD over the next 30 years because non-OECD countries will likely continue to use primarily fossil fuel-fired generation to support their more rapid economic growth over this time.

We also project that energy intensity, the energy consumed per dollar of GDP, will decline globally through 2050. Driven by technology and shifts away from energy-intensive industries in many economies, increased energy efficiency results in lower energy intensity. In the non-OECD region, economic growth results in a faster decline of energy intensity than in the OECD region. By 2050, the energy intensity of OECD and non-OECD countries becomes more similar as some non-OECD countries increase their share of less energy-intensive industries and their technology use becomes more similar to OECD countries.

Emissions-related policies also influence projections in energy-related CO2 emissions. Required efficiency, fuel, and technology goals are generally more prevalent in OECD countries, contributing to the relatively slower growth in emissions for the OECD relative to the non-OECD countries.

For more information on our projections of international energy-related CO2 emissions, refer to our International Energy Outlook 2021.

October, 25 2021
EIA projects nearly 50% increase in world energy use by 2050, led by growth in renewables

In our International Energy Outlook 2021 (IEO2021) Reference case, we project that, absent significant changes in policy or technology, global energy consumption will increase nearly 50% over the next 30 years. Although petroleum and other liquid fuels will remain the world’s largest energy source in 2050, renewable energy sources, which include solar and wind, will grow to nearly the same level.

primary energy consumption by source

Source: U.S. Energy Information Administration, International Energy Outlook 2021

Falling technology costs and government policies that provide incentives for renewables will lead to the growth of renewable electricity generation to meet growing electricity demand. As a result, renewables will be the fastest-growing energy source for both OECD and non-OECD countries. We project that coal and nuclear use will decrease in OECD countries, although the decrease will be more than offset by increased coal and nuclear use in non-OECD countries.

We project that global use of petroleum and other liquids will return to pre-pandemic (2019) levels by 2023, driven entirely by growth in non-OECD energy consumption. We do not project OECD liquid fuel use to return to pre-pandemic levels at any point in the next 30 years, in part because of increased fuel efficiency.

global delivered energy consumption by sector and energy source

Source: U.S. Energy Information Administration, International Energy Outlook 2021 Reference case
Note: Delivered consumption includes fuels directly used by the end-use sectors as well as electricity, excluding generation, transmission, and distribution losses.

We project that the industrial sector will increasingly consume petroleum liquids as feedstock in the expanding chemicals industry. In OECD countries, liquid fuel consumption in the industrial sector will grow three times as fast as liquid fuel consumption in the transportation sector.

Delivered electricity consumption will grow the most in the residential end-use sector. We project that in non-OECD countries, electricity will account for more than half of the energy used in households by 2050, compared with 33% in 2020. In non-OECD commercial buildings, we project that electricity will make up an even larger share of energy consumption in 2050, at 64%.

Globally, we project increased consumption of natural gas through 2050. The industrial sector is the main contributor to the growth in global natural gas consumption through 2050 in our Reference case, largely in non-OECD countries. Across OECD countries, gains in energy efficiency will reduce household natural gas use by 2050. The industrial sector will use the largest share of both natural gas and coal among all end-use sectors. Industrial coal use will expand fastest in non-OECD countries, where energy-intensive industries such as iron and steel production are expanding more quickly than in OECD countries.

October, 13 2021
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