Energy industry changes “profound and abrupt"
By: Barbara Vergetis Lundin, Fierce Energy
Published: February 7, 2014
Despite ever-shifting political winds, the inherent business case for efficient and sustainable energy sources has become even stronger over the past year. The 2014 Sustainable Energy in America Factbook -- produced for the Business Council for Sustainable Energy by Bloomberg New Energy Finance -- documents the upward trajectory of energy efficiency, natural gas and renewable energy.
Renewable energy had a record year in 2013, providing 13 percent of U.S. electricity generation -- up from 12 percent in 2012 and 8 percent in 2007. At the same time, renewable energy costs reached all-time lows, allowing clean energy, with the aid of incentives, to be cheaper than fossil fuel electricity in some parts of the country. Small, distributed generators and off-grid installations, meanwhile, began to emerge as a transformative force in the power industry.
Financiers who back small-scale solar systems have raised nearly $6.7 billion since 2008."The U.S. energy transformation that began in the mid-2000s gained additional momentum in 2013," said Lisa Jacobson, president of the Business Council for Sustainable Energy. "The factbook plays a vital role in chronicling this fast-moving transformation, which is creating whole new industries and thousands of new jobs in the energy efficiency, natural gas and renewable energy sectors."
The factbook provides not only a snapshot of 2013, but a look back over the last several years to help identify trends, presenting a number of diverse elements in the energy efficiency, renewable energy and natural gas sectors, painting a complex but positive picture for clean energy. For example, energy efficiency financing is on an upward trend.
Spending by energy service companies and electric and gas utilities -- often to comply with state efficiency resource standards -- totaled more than $12 billion in 2012. Meanwhile, 31 states and the District of Columbia -- representing 77 percent of the U.S. population -- have legislation in place enabling the financing of energy efficiency via property-assessed clean energy programs (PACE).
Technology for smart grid and smart homes is making its way into the market and has potential to be pervasive, driving even further efficiency gains in the future. "The changes unfolding in the U.S. energy industry have been profound and, by the typical time scale of the industry, abrupt," said Michel Di Capua, head of North American Analysis for Bloomberg New Energy Finance. "The effects of these changes will be felt in seemingly every nook and cranny of the American economy, from military bases to manufacturing plants, from homes to highways.
2013 saw some detours from the long-term trends, but overall, it is clear that the long-term transformation of how the U.S. produces and consumes energy continues." Global trends in technologies and markets indicate that clean energy sources are positioned to win in the long run. Net energy imports in the U.S. are estimated to have fallen by 15 percent between 2012 and 2013 and by more than 50 percent since 2005.
Energy efficiency, renewable energy and natural gas are mainly responsible for the nearly 10 percent decline in U.S. greenhouse gas emissions since 2005, leading the country more than halfway to President Obama's goal of achieving a 17 percent reduction in emissions by 2020.
"We urge legislators and policy makers to clarify and stabilize clean energy policies both at the federal and state levels in order to accelerate America's energy transformation," Jacobson said. "Clean energy technologies have made major gains in the last five years, and further growth will help reduce greenhouse gas emissions, improve our energy security and strengthen the U.S. economy.
"It is hoped that the factbook will help in that regard. "The Sustainable Energy in America Factbook is an important resource to show policymakers and the public the transformation occurring in our domestic energy sources, and we are pleased - but not surprised - that this study confirms solar's record-shattering growth in 2013," said Rhone Resch, president and CEO, Solar Energy Industries Association.
"BCSE has rightly pointed out that a competitive electricity market benefits customers, the environment and the economy. Going forward, we expect the data in this Factbook will help inform decision-makers and support smart public policies like net energy metering and the solar ITC."