It is one of the most remarkable energy transition stories – how the United States, the world’s largest economy, has halved its coal generation in just a decade. This post will provide an overview of American electricity generation, how it has changed over the last decade and how it compares with Australia. My post next week will explore the fascinating differences in coal generation across the 50 American states.
The national picture
Table 1. Proportion of electricity generation by fuel source in the United States.
| Fuel source | % in 2010 | % in 2015 | % in 2019 | Change from 2010 to 2019 |
| Natural gas | 23.9% | 32.7% | 38.4% | 14.5% |
| Coal | 44.8% | 33.2% | 23.5% | -21.3% |
| Nuclear | 19.6% | 19.6% | 19.7% | 0.1% |
| Other renewables (incl. wind and solar) | 4.1% | 7.2% | 10.9% | 6.8% |
| Conventional hydro | 6.3% | 6.1% | 6.7% | 0.4% |
| Other | 1.5% | 1.3% | 1.1% | -0.4% |
| Total renewable | 10.4% | 13.3% | 17.6% | 7.2% |
| Total non-emitting | 30% | 32.9% | 37.3% | 7.3% |
| Change in total generation from 2010 to 2019 | – | – | – | -0.2% |
It is no secret that current United States President Trump doesn’t accept the reality of climate change and support for the coal industry has been a key part of his electoral strategy. It is also no secret that former President Obama mostly failed to seriously cut greenhouse gas emissions in his eight years in office because many of his policy initiatives were blocked by a Republican-controlled Congress (and conservative Democrats).
It is a reflection of the weakness of the presidency and the federal government in the United States more generally that these events have had little impact on the underlying economic trends that have driven a steep and rapid decline in coal use over the last decade.
In 2010, coal was the single largest source of electricity generation in the United States, providing 45% of the country’s electricity. Gas provided 24% and nuclear provided 20%. Renewables, primarily hydro, provided 10% and other sources provided 1.5%.
Since then, coal generation has collapsed by almost half to just 24%. About one third of the decline in coal has been replaced by renewables, primarily new wind and solar plants. But gas generation has replaced the other two-thirds, increasing to 38%. Increased gas generation is not much of an improvement than coal from an emissions perspective because gas can be just as polluting as coal.
Gas is now the single largest source of electricity generation in the United States, even if it only provides a bit over a third of the country’s electricity. Coal, nuclear and renewables provide 24%, 20% and 18% respectively of the country’s electricity.
But there is more nuance to this. Although coal’s decline has been steady over the past decade, the increase in gas and renewables has not.
Between 2010 and 2015, the proportion of coal generation declined by almost 12%. About three-quarters of the gap left by coal was filled by gas and just one quarter was filled by renewables. This period was primarily characterised by cheap new gas supplies driving out more expensive coal.
The situation has been quite different over the last four years. Between 2015 and 2019, coal declined by almost 10%. Yet gas only covered about 55% of this gap; renewables covered 45%. Wind and solar in the United States are now outcompeting coal and are increasingly outcompeting gas (in Australia, wind and solar farms are already significantly cheaper than both new coal and new gas). Increasingly as coal power stations shut down, more and more of the gap is being filled by renewables.
On current trends, renewables will soon become the second largest source of electricity generation in the United States, on track to overtake both coal and nuclear in the next two to three years. In contrast to the rapid decline of coal and the rise in gas and renewables, nuclear generation has been stagnant, up just 0.1% in a decade.
There are some revealing contrasts between the energy transformations taking place in the United States and Australia:
- The United States has long had a more diverse mix of electricity generation than Australia, a situation that is still true today. While gas is the United States’ largest source of generation at 38%, coal is the largest source of generation in Australia at 56%. The risks of relying on such a polluting fuel source for such a large amount of Australia’s electricity will only increase as the world decarbonises.
- A core driver of the decline in United States coal generation has been the large fall in the price of gas. This is the complete opposite of the situation in Australia, where gas prices have skyrocketed in recent years.
- The total amount of electricity generation has barely changed in the United States over the last decade – down just slightly (0.2%). In the last five years alone, Australia’s total electricity generation has increased by 4%.
- The United States has a number of legacy nuclear power stations, built in previous decades and increasingly ageing. This means that the United States gets 37% of its electricity from non-greenhouse gas emitting power sources*, despite only 18% coming from renewable energy sources, like wind, solar and hydro. Australia does not have any nuclear power stations and we get slightly more of our electricity from renewables than the United States (21%).
If the trends of the past decade are anything to go by, the United States will completely phase out coal generation by the early 2030s.** For Australia to do the same will require a much more rapid phase out of coal than is currently planned.
Next week’s post will look at coal generation in more detail across America’s fifty states.
All data on electricity generation in the United States was calculated from the United States Energy Information Administration’s Electricity Data Browser.
Data on electricity generation used in this post was calculated from the Federal Government’s Australian Energy Statistics – Table O, released in May 2020.
*Nuclear power stations do produce toxic waste, but not in the form of greenhouse gases.
** Past performance is not necessarily a reliable indicator of future performance, to repurpose the super fund disclaimer.
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