Clean Energy Potential Gets Short Shrift in Policymaking, Group Says

Faulty projections by EIA on renewable energy growth are being used in critical policies like the Clean Power Plan, a trade group says.

The Energy Information Administration—the federal agency responsible for forecasting energy trends—has consistently and significantly underestimated the potential of renewable energy sources, misinforming Congress, government agencies and others that use the forecasts to analyze and develop policies, according to a report by a trade group of clean energy companies.

Wind generating capacity, for example, has increased on average by about 6.5 gigawatts each of the past 8 years, according to the report released Monday by Advanced Energy Economy, the trade association.  But the EIA has projected that only 6.5 gigawatts would be added between 2017 and 2030. Similarly, forecasts from industry groups that take projects in the pipeline into account show solar energy generation doubling by 2016 as solar costs plummet, while the EIA projects the doubling will take 10 more years.

"If the EIA has a lag on their assumptions, that might get perpetuated into other work," said Ryan Katofsky, lead author of the report and director of industry analysis at Advanced Energy Economy. The group's members include General Electric, SolarCity and SunPower, some of the largest U.S. wind and solar companies. The findings align with those of other environmental groups and the Lawrence Berkeley National Laboratory.

The EPA relied on EIA estimates in developing national carbon regulations for power plants, known as the Clean Power Plan. The rules set state-level emission reduction targets, which the EPA partly calculated by estimating the potential for renewable energy generation. Because the EPA used the EIA's assumptions, it underestimated renewables growth and set less ambitious targets than it could have done, according to Katofsky and researchers at the Union of Concerned Scientists and other environmental groups.

In their comments to the EPA on the Clean Power Plan, several states—including Kentucky and  Wyoming—and utilities said that shifting away from coal to natural gas and developing renewable energy and energy efficiency programs would be expensive and a burden on the public. But according to the report, the costs of solar are already about half of what the EIA estimates, and as renewable energy continues to capture a larger share of the market, states will be able to comply with the Clean Power Plan at a low cost.

Clean Energy Potential Gets Short Shrift in Policymaking, Group Says