Utilities in the United States have made a pledge to transition to 100% renewable electricity by 2060. While state mandates have played a role in this transition, it is the utilities themselves that are leading the way. According to Matthew Burgess, a CIRES fellow and assistant professor at CU Boulder, the private sector is moving faster than expected. This rapid progress can be attributed to various factors, including advancements in technology, decreasing costs of renewable energy, the shift from coal to natural gas, and the growing replacement of fossil fuels with renewables. It is clear that policy is not the only driving force behind this transition.
Grace Kroeger, an Environmental Studies student at CU Boulder, conducted an assessment on behalf of her honors thesis, inspired by her internship experience at a consulting firm focusing on energy and sustainability. Her aim was to scrutinize the actions of the key players involved in the energy industry – the companies responsible for generating and providing the energy used by the general population. Kroeger and Burgess compared the renewable energy targets set by states with the goals outlined by utilities themselves. They carefully analyzed 30 years of data to understand the changes made by utilities to meet renewable energy standards and the influence of state-level goals on these transitions.
States typically employ Renewable Portfolio Standards (RPS) and Clean Energy Standards (CES) to enforce renewable energy changes. However, the extent of these mandates varies across the country – some states have ambitious policies, while others have more manageable goals or none at all. The researchers also examined the documented goals of utility companies, which are usually publicly available. For instance, Xcel Energy intends to achieve 100% carbon-free electricity by 2050. By combining the data, the authors projected the timeline for utilities to achieve full decarbonization. Surprisingly, they discovered that the industry is surpassing policy expectations. Utility companies are on track to meet or even exceed state goals and mandates. The study predicts that the electric grid will achieve 100% decarbonization by 2060 if utilities remain committed to their goals. Furthermore, when taking nuclear energy into account, utilities could decarbonize as early as 2050.
Another unexpected finding of the study was that utility companies have plans to decarbonize regardless of whether their operating states have renewable policies or goals in place. As an example, Southern Company has decarbonization goals despite operating in states like Georgia, Mississippi, and Alabama, which lack portfolio standards. While there were some differences between blue and red states in terms of renewable energy goals and policies, the authors observed that most states, including red ones, are still on track to decarbonize in accordance with utilities’ targets.
The authors acknowledged that the study’s findings are based on utilities’ stated plans for the future, which are not guaranteed. However, when analyzing historical data, they discovered that utilities have already transitioned to renewables and reduced their reliance on fossil fuels at a faster pace than anticipated. Despite this positive news, both states and utilities are not progressing quickly enough to align with the Biden Administration’s goal of eliminating fossil fuels from the U.S. energy sector by 2035. This ambitious target was announced in April but did not come with accompanying policies or mandates. Nevertheless, there are intriguing developments taking place in the private sector, as highlighted by Burgess.
Utilities in the United States are taking significant steps towards achieving 100% renewable electricity by 2060. Although state mandates have had some impact, it is primarily the utilities themselves that are driving the transition. The private sector has exceeded expectations, thanks to technological advancements, cost reductions, and the gradual replacement of coal with natural gas and renewables. The assessment conducted by Grace Kroeger and Matthew Burgess reveals that utility companies are meeting or surpassing state goals and mandates. Moreover, utilities are actively working towards decarbonization, even in states without renewable policies. While there is still progress to be made to meet the Biden Administration’s ambitious target, it is evident that the private sector is leading the charge towards a sustainable future.
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