24 IOUs and public power groups have set the 2050 goal
Expansion of solar, storage and offshore wind key elements
So too will be hydrogen, CCUS and advanced nukes
As more US utilities aim for net-zero emission goals by 2050, analysts and industry executives said June 24 that to reach the last 20% of that goal will require innovations in the use of hydrogen, carbon capture utilization and storage and advanced nuclear reactors.
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Twenty-four US investor-owned utilities and public power groups have now established goals to be carbon-free by 2050, according to Susan Allan, chief strategy officer at the Smart Electric Power Alliance, in an S&P Global Ratings webcast. These and other utilities also have CO2 reduction goals ranging from 30% to 40% by 2030 and 70% to 80% by 2040 that are expected to be met largely with the installation of wind and solar generation.
However, Emil Avram, vice president of business development at Dominion Energy, noted that recent legislation in Virginia that sets a net-zero emission target of 2050 will mean that his company will need to expand its plans in order to comply.
Avram said Dominion, whose utility currently owns approximately 20 GW of capacity mainly in Virginia, will need to build approximately 40 GW of offshore wind, solar and storage to comply with the state’ legislature’s Clean Economy Act that that has set a net-zero emission by 2045 target. The new law is due to go into effect July 1.
Avram said the state also set a 2035 target that will require Dominion to build 16 GW of solar, 2.7 GW of storage and 5 GW of offshore wind, as well as to extend the operating license of four nuclear facilities, all at an estimated cost of between $32 billion to $40 billion.
He pointed to land availability issues for solar, energy storage challenges and reliability questions with regard to integrating all the new assets, which must also include “clean natural gas assets into the future.”
“Getting the last 20% to 30% to net-zero will require technology innovations,” he said, “and we will need the use of hydrogen, CCUS and advanced nuclear reactors.”
Allan, who said that “many companies are confident” in reaching their 2030 through 2040 CO2 reduction goals, cited the need for “new commercialization of technology” to reach the 2050 net-zero goal.
Among the 24 IOUs and public power groups that have established the 2050 goal are Southern Company, Duke Energy, Austin Energy and the Sacramento Municipal Utility District.
Dominion completes installation of two offshore turbines
The working title of the webinar was ESG and Renewables, The Transition, and was hosted by S&P Global Ratings.
Allan, whose group cohosted the webcast, said that the coronavirus pandemic has reduced power demand, but most of the renewable projects “are not installed for demand growth reasons but rather to reach clean energy goals.”
Avram said that while some of Dominion’s projects may have seen some delays as a result of the coronavirus pandemic, the delays, he said, “have not been too bad.”
He said Dominion has been working on the 12 MW, two-turbine offshore wind pilot project in the Atlantic Ocean and will complete installation of the turbines this week.
Jeff Weiss, the executive chairman and founder of Distributed Sun, a Washington-based clean energy finance group, said that “customers are driving the demand for renewables.”
He said renewables are in the middle of their second phase of growth, which he called the “virtual PPA stage.” This, he said, is where the distant, not connected wind or solar farm sells its power to data centers owned by such high-tech companies such as Microsoft and Google.
Weiss said there are four key elements to renewables: customers, policy, technology and capital.
He said that 60% of renewables are owned by utilities, with 40% owned by institutional infrastructure investors.
Weiss said that in the past two to three years there has been a “competition” to buy projects that were already operational and have a lower cost of capital.
“When a project goes COD and is a cash generating project, there is less risk,” he said.