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

Electricity-Renewables Analysis Working Group: 

Market Review, Policy Assumptions, Key Model Updates

For

EIA Electricity Working Group

May 27, 2021

By Office of Long-Term Energy Modeling 
AEO2022 Electric Sector-Renewables Working Group: 

Overview of first teleconference

• Review of Annual Energy Outlook 2021 (AEO2021) results

• Proposed modeling enhancements for AEO2022

• Preliminary changes to laws and regulations

• Considerations for future long-term domestic modeling

AEO2021 Electricity- Renewables Analysis 

Working Group May 27, 2021 2

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Review of AEO2021 results

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 3

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021

Source: U.S. Energy Information Administration, Annual Energy Outlook 2021

Electricity generation from natural gas and renewables increases as a result of lower 

natural gas prices and declining costs of solar and wind capacity

4

0

1,000

2,000

3,000

4,000

5,000

6,000

2010 2020 2030 2040 2050

2020

history projections

U.S. electricity generation from selected fuels 

AEO2021 Reference case

billion kilowatthours

natural gas

renewables

nuclear

coal

40%

21%

19%

19%

36%

42%

11%

11%

0

500

1,000

1,500

2,000

2,500

2010 2020 2030 2040 2050

U.S. renewable electricity generation, including end use

AEO2021 Reference case

billion kilowatthours

2020

history projections

solar 

wind

geothermal

hydroelectric

other 16%

41%

2%

34% 7%

46%

47%

34%

13%

2%

4%

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021

Natural gas prices continue to range between $3.50 and $4 per million 

British thermal units

Source: U.S. Energy Information Administration, Annual Energy Outlook 2021

5

$0

$2

$4

$6

$8

$10

$12

2000 2010 2020 2030 2040 2050

2020

history projections

Low Oil and Gas Supply

Reference

High Oil and Gas Supply

Natural gas spot price at Henry Hub AEO2021 oil and gas supply cases

2020 dollars per million British thermal units

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021

Natural gas-fired generation and renewables substitute for each other; coal and 

nuclear generation declines in Low Renewables Cost case

Source: U.S. Energy Information Administration, Annual Energy Outlook 2021

6

All-sector electricity generation from selected fuel by case, 2010–50

billion kilowatthours

0

500

1,000

1,500

2,000

2,500

3,000

2010 2020 2030 2040 2050

2020

projections

High Renewables Cost case

billion kilowatthours

0

500

1,000

1,500

2,000

2,500

3,000

2010 2020 2030 2040 2050

2020

projections

Low Renewables Cost case

billion kilowatthours

0

500

1,000

1,500

2,000

2,500

3,000

1990 2010 2030 2050

2020

history projections

natural gas

coal

nuclear

renewables

Reference case

billion kilowatthours

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Proposed modeling enhancements for 

AEO2022

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 7

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Planned AEO2022 modeling enhancements

• Revise dispatch operating modes to account for net load

• Implementation of renewable capacity credit foresight

• Retire or repowering of wind and solar plants

• Analyze solar diurnal capacity factor to improve capacity credit

• Reexamine solar inverter loading ratio

• Reevaluate market-sharing algorithm for technologies with substantially nonoverlapping duty cycles

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 8

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Planned model developments for AEO2022 (continued)

• Evaluate learning-based cost reductions for offshore wind with offshore oil 

drilling activity

• Implement algorithm to account for declining capacity credit of storage as a 

result of increased market penetration

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 9

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Changes to laws and 

regulations

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 10

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Changes to legislation and regulations

• Extension of the Production Tax Credit and Investment Tax Credit 

(December 2020)

• Cross-State Air Pollution Rule (CSAPR) update (March 2021) 

– Updates to seasonal nitrogen oxides budgets for 12 states for 2021-2024

• Affordable Clean Energy (ACE) rule has been removed (January 2021)

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 11

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
State RPS policies will be finalized toward the end of the 

AEO cycle 

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 12

WA: 100% x 2045 

OR: 50%x 2040* 

(large utilities)

CA: 100% 

x2045

MT: 15% x 2015

NV: 100% x

2050

AZ: 15% x 

2025*

NM: 100% x 2045

HI: 100% x 2045

CO: 30% x 2020

MN:26.5% 

x 2025)

MI: 10% x 

WI: 2015*† 10% 

2015

MO:15% x 

2021

IA: 105 MW

IL: 25% 

x 2026

OH: 8.5% x 

2026

NC: 12.5% x 2021 (IOUs)

ME: 100% x 2050

30 states and DC have a 

Renewable Portfolio Standard 

(RPS) 

No Change in RPS from AEO2021

Changes in RPS from AEO2021

DC

TX: 5,880 MW x 2015*

NH: 25.2%x 2025

VT: 75% x 2032

MA: 35% x 2030

RI: 38.5% x 2035

CT: 48% x 2030

NY:100% x 

2040

PA: 18% x 2021

NJ: 54.1% x 2031

DE: 25% x 2026

MD: 50% x 2030

DC: 100% x 2040

VA: 100% x 

2050

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Considerations for future long-term 

domestic modeling

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 13

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Long-term modeling enhancements

• Hydrogen production and use in the electric power sector

– Enhancement to improve deep decarbonization scenario analysis by incorporating an option for seasonal 

storage and a carbon-free reliability fuel

• Biomass generation with carbon capture and sequestration (CCS)

– Allow for a net negative carbon sink to improve ability to meet net-zero targets while maintaining gross 

positive fossil fuel-fired generation for reliability and seasonal use

• Non-fossil fuel spinning reserves

• Using a detailed (8760 hr) production cost model to inform long-term model inputs, 

structures, and results

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 14

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
AEO2022 Outlook Schedule

• Model development: June-October 2021

• Second Working Group Session: September-October 2021

• Expected AEO release: January-February 2022

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 15

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Contact information: Electricity Modelers

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

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

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

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

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

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

• Syne Salem Syne.Salem@eia.gov (202) 586-3014

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

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

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 16

WORKING GROUP PRESENTATION FOR 

DISCUSSION PURPOSES. DO NOT QUOTE OR 

CITE BECAUSE RESULTS ARE SUBJECT TO CHANGE
Questions or comments?

AEO2021 Electricity- Renewables Analysis 

Working Group May 27 2021 17