New England’s aggressive effort to decarbonize is a tangled web. Over the past several years, the six-state region has replaced oil- and coal-fired power plants with natural gas-fired ones but most proposals to build new gas pipeline capacity have been rejected. It’s also made ambitious plans to add renewables — especially solar and offshore wind — to its power generation mix but many of the largest, most impactful projects have been delayed or canceled. And now there’s a big push to electrify space heating and transportation, which will significantly increase power demand, especially during the winter months, when New England’s electric grid is already skating on thin ice. In today’s RBN blog, we examine the region’s looming power supply challenges and how its energy transition plans may affect natural gas, LNG, heating oil and propane markets.
As we said in The Tipping Point, the northeastern corner of the Lower 48 relied for a half-century on a traditional mix of oil, coal and gas plants — plus several nuclear units and some imported hydroelectric power from Quebec — to keep the lights on. More recently, though, enviro-conscious New Englanders have been cleaning house, shutting down many of their oil and coal facilities (and some nukes) and replacing them with new gas-fired combined-cycle plants and peaking units. They’ve also been making big plans to add renewables and have had some success in adding solar capacity and, to a lesser extent, onshore wind projects.
As shown in the two pie charts in Figure 1, the ramp-up in the region’s reliance on gas for power generation (yellow pie slices) has been dramatic — from only 12% of the electricity generated in 2000 to a hefty 46% last year. Over the same period, the share of New England’s power produced by oil plants (orange slices) and coal plants (gray slices) has plummeted to only 1% and 0.3%, respectively, from 18% and 14% at the turn of the century (coal’s share is too small to show in right graph), according to ISO New England (ISO-NE), which oversees the regional power grid. Notably, not much else has changed — nuclear’s piece of the pie (medium-blue slices) is down by 2 percentage points (to 23%), in-region hydroelectric power (light-blue slices) is up 1 percentage point (to 6%) and imports and renewables (dark-blue and green slices, respectively) are both flat at 14% and 11%.
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