America at Energy Crossroads, Part 1

The United States utilizes two energy pathways for sustaining its economy and standard of living.

Oil is the pathway used for transportation. There is no reason to believe that this will change in any meaningful way over the next few decades. Some transportation segments may use natural gas, but without massive investments in fueling stations it won’t displace oil. With extremely sluggish sales, electric vehicles (EVs and PHEVs) are merely a sideshow that won’t seriously impact the use of oil.

What’s great is that we can become independent with respect to oil in North America over the next decade. Fracking has made this possible – but fracking is under attack by the EPA.

Electricity is the other pathway for distributing energy to homes and industry. Electricity is the force behind America’s industrial greatness. In the first half of the twentieth century, its usage grew at 7% per year as motors displaced mechanical drives and as new appliances, such as refrigerators, air-conditioning units, stoves, washing machines, driers and many others, permeated America’s homes, making life easier for all Americans. Electricity was the force behind America’s ever improving standard of living.

Now, there is an emerging tragedy, where the EPA is destroying America’s ability to generate low-cost electricity.

Coal is dead, nuclear is dying and hydro is losing ground.

What’s left is natural gas, wind and solar.

Annual electricity growth rate1 over the next 38 years for the United States is forecast at 1%, which is essentially the same as population growth. With a 1% growth rate, the total generating capacity would need to be 1,658,873 MW, 38 years from now.

Some environmental groups assert that load growth can be cut to less than 0.5%, but this is an extreme position unjustified by the rate of population growth of nearly 1% and unrealistic assumptions about how families and industry can drastically cut electricity usage.

Meeting the above forecast requires building 610,000 MW of new generating capacity2, plus at least 50,000 MW3 additional capacity to replace coal plants that will have to close due to EPA regulations.

What happens if we try to meet this need for additional generating capacity with only natural gas, wind and solar?

First let’s look at wind and solar. Ignoring for the moment that they are unreliable and inconsistent sources of electricity, there is a 20% limit as to how much of this intermittent electricity the grid can tolerate. Assuming that it’s possible to actually reach this 20% limit, it would require installing over 700,000 wind turbines rated 1.5 MW4, with some portion of the total coming from solar5.

This would require building over 19,000 new wind turbines rated 1.5 MW every year, while the most ever built in one year was less than 7,000. Is this possible? Maybe. Realistic? No.

Electricity from these wind turbines would cost at least twice as much as electricity generated from gas-fired power plants, which would result in higher cost electricity for homeowners and industry.

And this wouldn’t include the cost of backup gas turbines running 24/7 or the nearly $100 billion6 required to build new transmission lines from remote locations where wind and solar would be installed. These added costs would also increase the cost of electricity to consumers.

Betting on unreliable wind and solar to provide a significant portion of America’s electricity is a very risky strategy – it would also end the era of low-cost electricity for American families and industry.

But even if 700,000 wind turbines can be built, they cannot supply all the electricity needed by 2050.

Part 2 will discuss whether NGCC power plants can provide the additional 328,000 MW of generating capacity needed by 2050, and the effect on the availability and cost of electricity if fracking is curtailed.

The choice facing America will be made clear in Part 2, as the two energy strategies are examined, side by side.


  1. Energy Information Administration forecast through 2035, extrapolated to 2050.
  2. Does not include any additional capacity for recharging batteries in the event PHEVs or EVs become popular.
  3. From EIA Annual Energy Outlook 2012.
  4. Average size of wind turbines currently being installed.
  5. 20% * 1,658,873MW = 332,000 MW maximum, adjusted for 30% Capacity Factor by dividing by .3 and then by 1.5 MW for name plate rating of wind turbine. Capacity factors for NGCC, Coal-fired and nuclear power plants are approximately 85%, 85% and 90% respectively, which shouldn’t change by 2050.
  6. Eastern Wind Integration and Transmission Study by EnerNex Corporation, January 2010, and Power Magazine, February 11, 2009

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