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As of July 1, 2022, we are continuing to restore our systems. The monthly data releases, including the Petroleum Supply Monthly, Natural Gas Monthly, and Electric Power Monthly, will be published next week. We will continue to post regular updates regarding the status of other data products.

Annual Energy Outlook 2022

Release Date: March 3, 2022 Next Release Date: February 2023 AEO Narrative PDF
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Battery storage complements growth in renewables generation and reduces natural gas-fired and oil-fired generation during peak hours

Battery storage complements solar capacity additions, captures solar generation that would otherwise be curtailed, and reduces nonrenewable generation to meet peak electric demand

Figure 14.

Figure 14

In 2021, limited surplus generation occurred throughout all hours of the day in the Reference case; however, by 2050, the large amounts of added solar capacity cause a surplus of generation in the middle of the day. Because solar has essentially zero variable operating costs, its high midday generation levels cause a large decrease in generation from natural gas-fired combined-cycle plants during these hours, as well as a slight decrease in generation from coal and nuclear plants. Once the solar generation is not available in the evening hours, the other generators ramp back up to meet demand. Batteries are also used to move excess solar generation during the daylight hours into the evening hours when demand is still relatively high.

Figure 15.

Figure 15

When utilities generate more electricity than needed to meet load, the excess energy can either be curtailed (not used) by the grid operator or stored. Because solar and wind generators are not dispatchable, curtailment often happens during very sunny and windy periods when energy storage is not economical or available. Only a small percentage of solar and wind generation is curtailed through the projection period in the Reference case. Most curtailment occurs during the winter and shoulder (spring/fall) seasons when demand is low. In the summer months, higher demand in midday hours results in less curtailment.

Figure 16.

Figure 16

In the Reference case, by 2050, most projected solar curtailments occur in the California ISO (CAISO), Electric Reliability Council of Texas (ERCOT), and Mid-Continent regions. These regions have a higher percentage of their load met by solar during the afternoon hours than most other regions. The Southeast region also has a relatively large percentage of load met by solar in midday hours, but it has fewer curtailments because its demand profile better coincides with solar generation than the other regions’ profiles. Some of the energy that would otherwise be curtailed is used for charging pumped hydro or battery energy storage sites. In the Reference case, most of the electricity provided by battery storage is in CAISO due to the relatively larger proportion of midday solar curtailments and resulting larger price disparity between midday and evening hours. Other regions meet their respective evening ramp periods, when solar generation decreases, with natural gas units.

Figure 17.

Figure 17

In the Low Renewables Cost case, by 2050, lower costs for solar and battery storage signficantly affect the daily hourly electricity generation profiles in all regions. In additon to the CAISO, ERCOT, and Mid-Continent regions, the Southeast region also curtails significant amounts of generation. All regions use much more battery storage than in the Reference case, most notably in the Mid-Continent and Southeast. Use of battery storage in each of these regions surpass CAISO, the region with the largest amount of installed battery capacity in 2021.

By 2050, the large amounts of added solar capacity cause a surplus of generation in the middle of the day.