The United States is home to a large and diverse mix of renewable energy sources, such as hydropower, biomass, wind, solar, geothermal and others. These sources are playing an increasingly important role in our nation’s energy supply, providing low or zero emissions electric power, and increasing the diversity of our energy portfolio. Consumption of renewable energy, which meets about 12% of U.S. energy demand, is increasing. Biomass fuels such as ethanol and biodiesel are used largely in the transportation sector, where they account for about 5% of demand. Hydropower, wind, solar, and geothermal technologies are used to generate electricity. Hydropower and wind each account for about 7% of total U.S. electricity generation, and solar about 2%.
Generation from both wind and solar is growing rapidly. While these technologies are becoming more cost competitive, policies promoting the commercial use of renewable electricity resources, such as tax subsidies and state-level renewable portfolio standards, continue to be the key drivers of capacity expansions. The phase-out of the federal Investment Tax Credit for solar and Production Tax Credit for wind may affect future builds of these technologies. In the transportation sector, the federal Renewable Fuels Standard guarantees demand for biofuels.
In the power generation sector, the variability and unpredictability of generation from wind and solar technologies in particular, challenge the ability of these technologies to provide a greater contribution to total U.S. electricity production. As electrification of the economy continues and as generation from intermittent renewable resources increases, load management will grow in importance. The development of cost-effective electricity storage technologies would help compensate for the current intermittency of wind and solar sources by balancing their output with real-time demand for electricity. Additional transmission infrastructure also will be needed to make the system more robust.
GEI advocates for streamlining the permitting process for needed transmission and other energy infrastructure, as well as continued investments to make solar, wind and other renewables competitive.