New gas-fired power plants

New gas-fired power plants

December 18, 2018 | By Keith Martin in Washington, DC

New gas-fired power plants are expected to eclipse wind and solar installations this year.

The latest capacity report covering the period through September issued by the US Energy Information Administration in mid-December predicts that more than 22,000 megawatts of new gas-fired power plants will be put in service this year.

Many are in PJM, the part of the utility grid covering the mid-Atlantic states out as far west as parts of Illinois and Michigan.

This is the first time since 2013 that that gas capacity additions will have outstripped renewables.            

The numbers reflect a collapse in natural gas prices in the Appalachian basin in 2015, leading to a rush of new development two and three years ago.

The broad market shift to renewables is expected to continue, but any forecast has to take into account that US electricity demand is barely growing, and the best opportunities to add generating capacity are in parts of the country where coal and nuclear plants are being retired. Gas may have an economic advantage in such places over renewables. On the other hand, what load growth there is tends to be in places like Texas and Arizona, where renewables have the advantage.

A megawatt of gas capacity adds 2.9 times the electricity output as a megawatt of utility-scale solar because solar plants can only produce electricity during the day.

Capacity factors for solar vary by state. The best states are California with a 28.1% capacity factor, Arizona with 27%, Nevada with 26.7%, New Mexico with 25.8%, Colorado with 22.7% and Texas with 21.7%.