By the OGJ Online Staff
HOUSTON, Mar. 12�Renewable energy, especially solar, is expected to grow dramatically in the next few years.
The growth will be stimulated by better economic fundamentals, improved technology, scale effects, and higher comparative costs of fossil fuels, according to a report issued Monday by Greg Haas, analyst with Raymond James & Associates. Government incentives and rising demand by niche electricity users will also contribute to the growth.
Hass projected solar energy will grow an average by 28.5%/year through 2005.
But Haas stressed the growth in renewables will not interfere with economic fundamentals of conventional oil and gas fuels for power plants over the near term. Renewables only fuel 2% of the nation�s power generation fleet after hydro is stripped out.
Natural gas is still the fuel of choice, but other conventional fossil fuels are getting some attention given high gas prices. Haas noted several new coal burning plants will be up and running by the middle of the decade.
But wind and solar will continue to grow, despite the renewed interest in conventional power plants. Growth in solar capacity will outrun that of gas turbines. Wind is also forecast to outpace other competing renewable electric generation resources.
There is also a favorable regulatory climate for renewables and alternative electric power technologies. Just five states don�t have metering provisions that allow small generators to sell excess power back into the grid, Haas said. Those states are Georgia, Kentucky, Louisiana, Michigan, and West Virgina. But if legislation passes in Congress, even those states will allow home generators onto the grid and make net metering available nationwide, he said.
Haas also said the Bush Administration will be proposing a US Energy Department budget that will offer tax credits, rebates, grants, and research funds for all types of renewable sources, including fuel cells, microturbines, and even energy storage devices.
Despite the implied growth of renewables, there is plenty of room for conventional fossil fuels, said Haas.
Alternative or renewable power technologies are available in much smaller capacity units than big coal, gas, or nuclear plants. Renewable units, which serve a specialized niche market , can range in size from just a few kilowatts to fewer than 10 Mw. Renewable units serve demand near the point of generation and usually include an energy storage device such as a battery or flywheel.
Conventional energy such as coal, gas, oil, nuclear, and hydro will continue to supply the largest share of energy for the nation and serve the wholesale bulk power markets. Haas said alternative energy sources will serve a specialized niche market and are available in capacity increments far smaller than the big conventional fuel-fired power plants.
