WORKING GROUP PRESENTATION FOR DISCUSSION PURPOSES ONLY.

DO NOT QUOTE OR CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE.

November 3, 2020

MEMORANDUM FOR: Angelina LaRose

Assistant Administrator for Energy Analysis

FROM: Jim Diefenderfer

Director, Office of Electricity, Coal, Nuclear, and Renewables Analysis

SUBJECT: Summary of Annual Energy Outlook 2021 (AEO2021)

Working Group for Electricity, Coal, and Renewables Analysis,

held on October 22, 2020

The working group presentation summarized the preliminary results from the Annual Energy Outlook 

2021 (AEO2021) for electricity, coal, and renewables. These preliminary results are included in the 

presentation materials provided in a separate document on the U.S. Energy Information 

Administration’s (EIA) website.

Overview

AEO2021 will include the eight core side cases (High/Low Economic Growth, High/Low Oil Price, 

High/Low Oil and Gas Supply, and High/Low Renewables Cost) and the Reference case.

We (EIA staff) asked for stakeholder feedback on topics for AEO2021 in the first working group meeting, 

held on August 6. During this most recent working group meeting, participants reviewed preliminary 

results based on the model developments discussed during the first working group meeting, and we 

asked participants whether the results seemed consistent with stakeholder thinking.

We began the meeting by presenting an overview of the EIA-sponsored workshops that we held in late 

September and early October to discuss the key issues to consider when developing near- and long-term 

outlooks in light of the global response to the COVID-19 pandemic. Recordings of these workshops are 

available on the EIA website. 

Model updates

We reviewed the model updates to account for current laws and regulations, as well as a few of the 

proposed laws and regulations that we discussed at the first working group meeting that will not be 

included in AEO2021 for various reasons, primarily because the legislation has not been finalized.

We then discussed the preliminary results for AEO2021, including the following results:

• A largely unchanged level of total power generation from AEO2020 despite lower prices for all 

fossil fuels and renewable sources’ move to replace natural gas and coal 

• An increase in the number of coal and nuclear units expected to retire relative to AEO2020, as a 

result of lower electricity prices and higher renewables capacity additions
WORKING GROUP PRESENTATION FOR DISCUSSION PURPOSES ONLY.

DO NOT QUOTE OR CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE.

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

the production tax credit for another year

• An increase in overall solar capacity additions while keeping the stand-alone storage level 

similar to AEO2020 as a result of the addition of the solar-battery hybrid technology option

• Electricity demand that remains relatively unchanged in total compared with AEO2020, although 

the sector level patterns are different (residential demand is higher, while commercial and 

industrial demand is lower)

• A continuation of the slight decline in coal production, in proportion with the decline in the coal 

used for power generation

• A slight decline in the demand for non-power related coal from AEO2020, along with a projected 

recovery in coal exports from the lower 2020 export level.

Discussion

The discussion following the presentation focused on a few detailed topics.

Several participants asked how EIA handles the life cycle of renewables, how EIA handles the 

retirements of renewables, or if EIA assumes that renewables are automatically repowered. In addition, 

a participant asked if EIA includes performance degradation for wind, solar photovoltaic, or battery 

storage projects. We explained that although renewables are not retired within the model, the 

operation and maintenance cost assumptions for renewables account for the costs of maintaining a 

certain level of performance. Although we are not currently modeling repowering as an option for 

renewables, it is on our list of model developments for future consideration.

An attendee asked if EIA has any concerns for the potential of unmet load with the increase in 

intermittent renewable capacity. Although preliminary AEO2021 results show an increase in 

intermittent renewables from AEO2020, unmet load is not an issue during the projection period. We

specifically account for the declining contribution of wind and solar toward meeting system planning 

reserve margins, which ensures that enough firm capacity is built within the model to ensure system 

reliability.

A participant asked how EIA has reconciled the impact of the Affordable Clean Energy (ACE) rule in the 

National Energy Modeling System (NEMS) compared with the U.S. Environmental Protection Agency 

(EPA) projections of the impact in their associated regulatory impact analysis.

We explained that to evaluate the impact of ACE in EIA’s results you would have to compare the cases 

with and without the ACE rule, as was done for AEO2020. The AEO2020 No ACE Rule case had about 6 

gigawatts less of retirements by 2050 relative to the AEO2020 Reference Case, indicating that ACE was 

not the primary driver of coal-fired unit retirements in NEMS. EPA’s Regulatory Impact Analysis found 

only a few gigawatts of additional coal-fired retirements from the ACE rule as well; however, EPA’s

baseline retirements were not as high as those projected by EIA. EIA published analysis of the ACE rule 

in its Alternative Policies for AEO2020.

The final question was whether we consider small-modular reactors (SMRs) as a stand-alone nuclear 

technology or include them in either the existing conventional nuclear or advanced nuclear technology 

options. We said that we created a new technology slot in the model for SMRs. As a result, for AEO2021 
WORKING GROUP PRESENTATION FOR DISCUSSION PURPOSES ONLY.

DO NOT QUOTE OR CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE.

we will include two different nuclear technologies as options for electric generating unit capacity 

expansion.

Attendees

EIA hosted this online working group meeting, which was attended by 61 people, including EIA staff and 

external participants.

Guests

First Name Last Name Affiliation 

Misha Adamantiades U.S. Environmental Protection Agency 

Barry Basile U.S. Department of Energy

Jose Benitez U.S. Department of Energy

James Bernhart First Energy Corporation

Wesley Cole National Renewable Energy Laboratory

Leslie Coleman National Mining Association 

Regis Conrad U.S. Department of Energy

Rachel Goldstein Solar Energy Industry Association

John Hensley American Wind Energy Association

Jeff Hubbs Georgia Institute of Technology

Tina Kaarsberg U.S. Department of Energy

Serpil Kayin U.S. Environmental Protection Agency 

Lauren Khair National Rural Electric Cooperative Association

Ben King Rhodium Group

Jordan Kislear U.S. Department of Energy

Hannah Kolus Rhodium Group

Danielle Koren U.S. Department of Energy

Yanghe Liu Entergy

Trieu Mai National Renewable Energy Laboratory

Cara Marcy U.S. Environmental Protection Agency 

Gregory Marmon Wood Mackenzie 

Jim Moore Spire Energy

Greg Moxness U.S. Department of Labor

Chris Nichols National Energy Technology Laboratory

Hannah Pitt Rhodium Group

Alfredo Rivera Rhodium Group

Robert Schrecengost U.S. Department of Energy

Sharon Showalter On Location 

Don Wehbey U.S. Department of Labor

David White Synapse Energy

Robin White Environment and Climate Change Canada 

Tom Wilson Electric Power Research Institute 

Tom Wos Tri-State Generation and Transmission Association
WORKING GROUP PRESENTATION FOR DISCUSSION PURPOSES ONLY.

DO NOT QUOTE OR CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE.

EIA staff attendees

First Name Last Name Affiliation 

Greg Adams * U.S. Energy Information Administration

Lori Aniti U.S. Energy Information Administration

Lindsay Aramayo U.S. Energy Information Administration

Erin Boedecker U.S. Energy Information Administration

Richard Bowers * U.S. Energy Information Administration

Michelle Bowman U.S. Energy Information Administration

Michael Cole U.S. Energy Information Administration

Jim Diefenderfer * U.S. Energy Information Administration

Kenneth Dubin U.S. Energy Information Administration

Kathryn Dyl U.S. Energy Information Administration

Mindi Farber-DeAnda U.S. Energy Information Administration

Meera Fickling U.S. Energy Information Administration

David Fritsch U.S. Energy Information Administration

Tyler Hodge U.S. Energy Information Administration

Thaddeus Huetteman * U.S. Energy Information Administration

Kevin Jarzomski U.S. Energy Information Administration

Scott Jell U.S. Energy Information Administration

Slade Johnson U.S. Energy Information Administration

Ari Kahan U.S. Energy Information Administration

Perry Lindstrom U.S. Energy Information Administration

Vikram Linga U.S. Energy Information Administration

Nilay Manzagol U.S. Energy Information Administration

Laura Martin * U.S. Energy Information Administration

Chris Namovicz * U.S. Energy Information Administration

Andri Rizhakov U.S. Energy Information Administration

John Staub U.S. Energy Information Administration

Manussawee Sukunta * U.S. Energy Information Administration

Edward Thomas U.S. Energy Information Administration

*Presented during the working group