U.S. Energy Information Administration Independent Statistics & Analysis www.eia.gov

Annual Energy Outlook 2021 (AEO2021)

Working Group for Electricity, Coal, and Renewables Analysis : 

Preliminary Results 

For

EIA Joint Working Group for Electricity, Coal, and Renewables 

October 22, 2020

By

Office of Electricity, Coal, Nuclear, and Renewables Analysis
EIA Joint Working Group for Electricity, Coal, and Renewables Analysis, AEO2021: 

Overview of Second Teleconference

AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020 2

WORKING GROUP PRESENTATION FOR 

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• Review of energy markets workshop

• Review of key developments and current laws and regulations

• Preliminary results for AEO2021

• Photovoltaic-battery storage hybrid technology option

• Coal production and exports
AEO2021 Cases

• Reference case

– Only being discussed for this Working Group 

• Core side cases

– High/Low Oil Price

– High/Low Economic Growth

– High/Low Oil and Gas Resource and Technology

– High/Low Renewables Cost Case

3

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Review of Energy Markets Workshops

4

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
EIA Held a Series of Workshops to Consider Near- and 

Long-Term Impacts of Energy Markets

• Near-term impacts are significant across markets, but they may be significantly 

reduced when looking over the 30-year projection period of the AEO

– Electricity demand is down slightly, and load patterns shifted as more people worked from home and 

commercial demand decreased

– Overall impacts on the power sector are modest, and are not likely to greatly affect long-term projections

– Global oil and natural gas trade was significantly disrupted, further depressing natural gas prices in the 

United States, but these prices could rebound significantly before restabilizing

• The current economic down-turn has the greatest potential for effects beyond the oneor two-year forecast 

– Potential impacts on investment as capital becomes more scarce

– Energy demand in general may be depressed until the economy recovers

5

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Review of key developments and current 

laws and regulations

6

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Key Developments for AEO2021 in Electric Sector Modeling

•Electricity and nuclear

–Dynamic regional capability – implemented for future use

–High-voltage direct current (HVDC) transmission – evaluate regional cost data

–Small modular reactors (SMR) – udded as a capacity expansion option

–Change in treatment of distributed generation

•Renewables

– Added solar photovoltaic plus battery storage as an option for capacity expansion

– Revised Landfill Gas (LFG) Submodule to be solved outside of the capacity expansion model

– Updated long-term resource multiplier for wind in the recent 25-region-model

•Coal

– Implemented a new coal transportation rate escalation methodology based on a rail cost adjustment factor approach (RCAF) used by the 

Surface Transportation Board

– Linked fuel costs used to calculate international seaborne coal freight rates based on fuel prices modeled in National Energy Modeling 

System (NEMS)

– Revised coal model base year parameters included

7

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Updated Legislation and Regulations

• Ohio HB 6

– Legislative action in Ohio (Ohio HB 6) does not appear likely until sometime after the November elections, so AEO2021 will continue to assume 

the Ohio zero emissions credits (ZEC) program will be continue, barring immediate action

• Virginia Clean Energy Economy Act (Senate Bill 851/House Bill 1526) 

– Virginia Clean Economy Act (Senate Bill 851/House Bill 1526)

• 2021: carbon dioxide (CO2) allowance of $27.16 pet metric ton (mt)

• Allocation decreases each year by $0.84/mt CO2

• 2030 and beyond: CO2 allowance of $19.6/mt CO2

– Dominion Energy and Appalachian Power required to retire carbon-emitting electric generating units by Dec. 31, 2045

• Potential entrant: Pennsylvania (legislative roadblock House Bill 2025) 

– Legislative action in Pennsylvania regarding HB 2025 does not appear likely until sometime after the November elections, so Pennsylvania will 

continue to remain a potential entrant to Regional Greenhouse Gas Initiative (RGGI) in AEO2021, barring immediate action

8

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Other Policy and Regulatory Considerations

• Because the Reference case only includes current laws and regulations, the Federal 

Energy Regulatory Commission (FERC) Minimum Offer Price Rule (MOPR), has not 

been finalized into an actionable policy yet.

• We have conducted a review of utility-level integrated resource plans (IRP) and other 

corporate statements for voluntary reductions in carbon emissions.

– IRPs are not binding policy documents, and their execution will be shaped by future market developments

– Similarly, voluntary carbon commitments are largely aspirational in nature, and are subject to future market 

pressures

– No change in EIA precedent: “current laws and regulations” will remain the basis for input assumptions to 

Reference Case

9

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Wave of coal retirements will likely continue based on 

review of already planned or announced retirements

AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020

Source for actual and planned retirements: Survey Form EIA 860-M data as of May 2020 and analyst research on specific announcements. 

Announced retirements are based on analyst research and have not been classified as a planned retirement included in the AEO2021

Reference case.

10

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0

2

4

6

8

10

12

14

16

2010 2015 2020 2025 2030 2035 2040 2045 2050

Coal plants retirements, planned, and announced (2010-2050)

net summer capacity in gigawatts (GW)

retired

planned 
Preliminary results for AEO2021

11

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Summary of Preliminary Results

• Slower recovery by the industrial sector through the projection period leads to lower electricity 

demand overall.

• Natural gas generation remains largely unchanged from AEO2020 despite lower natural gas prices 

• More coal and nuclear units are expected to retired than in AEO2020, as a result of lower electricity 

prices and higher renewables capacity additions.

• Wind capacity additions increase, especially in the near term, as a result of the extension of the 

production tax credit for another year.

• The solar-battery hybrid technology option increases overall solar additions while keeping the 

stand-alone storage level similar to AEO2020.

12

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Projected levels of generation by fuel

Source: ref2020.1121a, ref2021.1018a

13

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020

AEO2021 ______

AEO2020 _ _ _ _

0

500

1,000

1,500

2,000

2,500

1990 2000 2010 2020 2030 2040 2050

Electricity generation from selected fuels

billion kilowatthours

2020

history projections

Reference case

natural gas

renewables

coal

nuclear petroleum
Capacity additions and retirements by fuel type, 2010-2050

Source: ref2020.1121a, ref2021.1018a

14

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Natural gas prices continue to trend lower over the long 

term

AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020

Source: ref2020.1121a, ref2021.1018a

15

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

2015 2020 2025 2030 2035 2040 2045 2050

Natural Gas: Henry Hub spot price

2019$ per million British thermal units (MMBtu)

AEO2020

AEO2021

2020

history projections

WORKING GROUP PRESENTATION FOR 

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Total electricity sales 

AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020

Source: ref2020.1121a, ref2021.1018a

16

3,000

3,250

3,500

3,750

4,000

4,250

4,500

4,750

5,000

2015 2020 2025 2030 2035 2040 2045 2050

Total electricity sales

billion kilowatthours (kWh)

AEO2020

AEO2021

2020

history projections

WORKING GROUP PRESENTATION FOR 

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Photovoltaic-battery storage hybrid 

technology option

17

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
EIA Has Introduced a Solar Photovoltaic-Battery Storage 

Hybrid System as an Option for Capacity Expansion

• Direct current (DC) plus 150 megawatts of PV plus a 50-megawatt storage system 

with a four-hour duration

• Receives full investment tax credit (ITC)

• Only generates value through energy and capacity markets, like stand alone storage

• Forced to dispatch to a predetermined daily pattern that optimizes production during 

high-value periods in each region

– Dispatch pattern is not sensitive to model pricing and demand changes

– We determined high value periods by the later year results from running the REStore model in a high 

renewable penetration scenario. We then fed these results were then fed into National Renewable Energy 

Laboratory’s (NREL) System Advisory Model (SAM) to generate the dispatch patterns in each region

18

WORKING GROUP PRESENTATION FOR 

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
0

50

100

150

200

250

2020 2030 2040 2050

hybrid

storage

storagestand-alone

Total storage (energy) capacity additions (2020

gigawatthours

Adding hybrid systems results in less endogenous stand-alone storage, 

but significantly higher amounts of projected total storage capacity

Source: ref2020.1121a, ref2021.1013a

19

0

5

10

15

20

2020 2030 2040 2050

AEO2021

AEO2020

Stand alone storage power capacity additions

gigawatts

WORKING GROUP PRESENTATION FOR 

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
0

50

100

150

200

250

300

350

400

2020 2030 2040 2050

AEO2021

AEO2020

0

50

100

150

200

250

300

350

400

2020 2030 2040 2050

solar hybrid

solar standalone

Total power sector solar capacity additions

gigawatts

Solar capacity additions by type (2020–50)

gigawatts

Preliminary results indicate hybrid systems displace some standalone 

PV systems, but expands the total market reach

Source: ref2020.1121a, ref2021.1013a

20

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Coal production and export

21

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Coal Production by Region, 1970-2050

AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020

Source: ref2020..112120a, ref2021.101820a *2020 - 2021 data are estimated based on the Short-Term Energy Outlook forecasts

22

Appalachia

Interior

Western

U.S. Total.

0

200

400

600

800

1000

1200

1970 1980 1990 2000 2010 2020 2030 2040 2050

Regional coal production, 1970-2050

million short tons

21 Total U.S.

20 Total U.S.

AEO2021

AEO2020

2020

history projections

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U.S. Coal Exports are Expected to Recover Only Gradually 

Through 2050

AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020 23

0

20

40

60

80

100

120

140

1995 2000 2005 2010 2012 2015 2019 2020 2025 2030 2035 2040 2045 2050

coking

steam

U.S. coal exports,1995-2050

million short tons

history projections

Source: ref2021.101820a *2020 data are based on the Short-Term Energy Outlook forecast

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24

Contact Information for EIA Electricity Analysis Team

• Thad Huetteman,Team Leader Thaddeus.Huetteman@eia.gov (202) 586-7238

• Lori Aniti Lori.Aniti@eia.gov (202) 586-2867

• Kenneth Dubin Kenneth.Dubin@eia.gov (202) 586-0477

• Tyler Hodge Tyler.Hodge@eia.gov (202) 586-0442

• Scott Jell Scott.Jell@eia.gov (202) 586-5196

• Augustine Kwon Augustine.Kwon@eia.gov (202) 586-3645

• Nilay Manzagol Nilay.Manzagol@eia.gov (202) 586-3704

• Laura Martin Laura.Martin@eia.gov (202) 586-1494

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Contact Information for EIA Coal Analysis Team

• Greg Adams, Team Lead Greg.Adams@eia.gov (202) 586-7343

• David Fritsch David.Fritsch@eia.gov (202) 287-6538

• Bonnie West Bonnie.West@eia.gov (202) 586-2415 

• Kien Chau Kien.Chau@eia.gov (202) 586-4280

• Lindsay Aramayo Lindsay.Aramayo@eia.gov (202) 586-7277

25

WORKING GROUP PRESENTATION FOR 

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
Contact Information for EIA Renewable Electricity Analysis Team

• Chris Namovicz, Team Leader Chris.Namovicz@eia.gov (202) 586-7120

• Richard Bowers Richard.Bowers@eia.gov (202) 586-8586

• Michelle Bowman Michelle.Bowman@eia.gov (202) 586-0526

• Vikram Linga Vikram.Linga@eia.gov (202) 586-9224

• Fred Mayes Fred.Mayes@eia.gov (202) 586-1508

• Manussawee Sukunta Manussawee.Sukunta@eia.gov (202) 586-0279

• Ed Thomas Edward.Thomas@eia.gov (202) 586-3704

26

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020
For More Information 

U.S. Energy Information Administration home page | www.eia.gov

Annual Energy Outlook | www.eia.gov/aeo

Short-Term Energy Outlook | www.eia.gov/steo

International Energy Outlook | www.eia.gov/ieo

Monthly Energy Review | www.eia.gov/mer

Today in Energy | www.eia.gov/todayinenergy

State Energy Profiles | www.eia.gov/state

Coal Data Browser | www.eia.gov/coal/data/browser

U.S. Energy Mapping System | www.eia.gov/state/maps.php?v=Coal

International Energy Portal | www.eia.gov/beta/international/?src=home-b1

27

WORKING GROUP PRESENTATION FOR 

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AEO2021 Electricity Working Group for Electricity, Coal, and Renewables Analysis 

October 22, 2020