# Presentation: 526318

## EIA Renewable Energy Projections in Alternative Scenarios

- EIA Energy Outlook, Modeling and Data Conference
- March 28, 2007
- Washington, DC
- Robert K. Smith, OIAF

## Annual Energy Outlook 

- AEO contains mid-term projections of U.S. energy markets
- AEO2006 and AEO2007 project through 2030
- Reference Case represents current laws and regulations
- Contain over 30 sensitivity cases with varying technology and market assumptions
- Reference Case is also used as a baseline to analyze the potential impacts of proposed laws and regulations at the request of Congress
- See http://www.eia.doe.gov/oiaf/aeo/index.html

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## National Energy Modeling System (NEMS)

- Used to develop AEO and policy analysis scenarios
- Integrated U.S. energy sector model with macro-economic feedback
- Captures market feedback among different sectors (such as natural gas price response to increased share of renewable generation)
- Electricity sector modeled at a 13 region level based on NERC sub-regions
- Updated annually
- Key assumptions continuously revisited
- New modeling techniques added to improve representation
- Adaptable to represent new policies or policy detail variations (for example, several different approaches to RPS structures)

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## Alternative Cases Impacting Renewables using AEO2006 Assumptions

| Policy | Policy Assumptions | Additional Information |
| --- | --- | --- |
| Clean Energy Portfolio Standard (CEPS) 
Requested by Senator Coleman | Suppliers must generate specific percentage of total sales from low-carbon energy including renewables and nuclear.  Credit price is capped.   | Follow-up on earlier analysis, reducing the credit to nuclear and increasing the required clean energy shares.   |
| Alternative Greenhouse Intensity Reduction Goals
Requested by Senator Salazar | Based on 12/2004 NCEP report, with additional GHG intensity reduction cases .   | Range of GHG intensity reductions also include alternative safety values.     |
| Ten-Year PTC Extension  | Assumed PTC would not expire until 2016.  Renewable technologies receive 1.9 cents/kWh, except biomass which receives half of the credit.   | PTC modeled in AEO2006 and AEO2007 to expire January 1st, 2008.  Has since been extended another year.   |
| GHG Intensity Reductions with Cap-and-Trade
Requested by Senators Bingaman, Landrieu, Murkowski, Specter, Salazar, Lugar | GHG  emissions to be reduced through cap-and-trade. 90 percent of emission allowances are initially given away, but auction share grows over time.   | Sensitivity cases included a full auction case.   |

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## Renewable Capacity(Gigawatts) 

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## Power Sector CO2 Emissions(million metric tons)

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**Notes:**
Data Source: Place holder data.

## Average End Use Electricity Prices(2005 cents per kilowatthour)

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## Nuclear Capacity(gigawatts)

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## Natural Gas Wellhead Prices(2005 dollars per thousand cubic feet)

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## AEO2007 Renewable Technology Modifications and Alternate Cases

- Wind performance assumptions changed to better reflect recent performance
- Geothermal costs and resource potential updated from recent studies.

| Case  | Assumptions | Additional Information |
| --- | --- | --- |
| Ten-Year PTC Extension  | PTC expiration delayed until 2017.  Renewable technologies receive 1.9 cents/kWh, except biomass which receives half of the credit | Same tax credit assumptions as in AEO2006, however different results due to revised renewable technology assumptions.   |
| Regional RPS Case | Assumes most states with RPS provisions meet their targets.   | Aggregates state requirements up to NEMS regions.  Does not assume interregional qualifying generation.   |

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## Renewable Capacity(gigawatts)

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## Summary 

- Portfolio standards, extended tax credits and GHG cap-and-trade program cases examined by EIA all stimulated increased renewable capacity additions and generation.
- All cases also showed reduced GHG emissions, but the impacts were much larger in the GHG cap-and-trade cases.
- With the exception of the extended tax credit cases, all cases led to higher electricity prices, with GHG cap and trade cases having the largest impacts.

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## Contact Information

- Energy Information Administration
- www.eia.doe.gov
- Robert K. Smith
- robert.smith@eia.doe.gov
- 202-586-9413

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