Efficiency Movement Not Strong Enough to Balance Rising Consumption

The United States is making the greatest push in its history to use renewable energy. However, thus far, one of the biggest obstacles for implementing renewables has been the United States’ exorbitant energy demand, which accounts for 26 percent of the world’s energy consumption. Market research firm Frost & Sullivan recently released a report focusing on the demand aspect and how it will pan out in conjunction with renewables adoption.

According to Frost & Sullivan, the nation imports nearly 30 percent of the energy it consumes, and minimal reduction in imports is anticipated to 2020. Renewables adoption is intended to remedy the reliance on foreign fuels; however, the firm notes that the industry must focus on developing more than renewables alone. It states the country must also push for greater efficiency and more intelligent transmission and distribution methods.

Frost & Sullivan’s new analysis finds that United States energy consumption will increase by 7.3 percent during a 10-year period over 2010 levels. To meet this mounting need, the market has witnessed strong growth in renewable technologies, which has been supported by the focus on domestic energy production and sustainability. Solar photovoltaic (PV) and wind power are the fastest growing renewable technologies and, according to Frost & Sullivan, will represent more than 40 percent of electricity generation in 2020.

“Increased energy consumption over the forecast period of 2010 to 2020 is driven by increases in population and economic growth,” said Georgina Benedetti, Frost & Sullivan senior industry analyst. “The population in the United States is projected to increase by 7.5 percent from 2011 levels, reaching 324 million by 2020.”

The Department of Energy estimates 223 gigawatts (GW) of new generating capacity will be needed between 2010 and 2035. Local transmission infrastructure capability, currently in the process of being upgraded to withstand increasing loads and new forms of generation, is an important requirement to deploy large renewable-energy projects that also meet the necessary gigawatt capacity. Additionally, the transmission line shortage threatens to slow the growth of wind energy and large utility-scale solar projects and could prevent some states from meeting renewable-energy mandates. High costs further challenge renewable technologies growth.

Frost & Sullivan credits governmental support for solar and wind’s exceptional growth. Section 1603 of the American Recovery and Reinvestment Act of 2009 was one of the main drivers for solar installations during 2010 and 2011, but the market has taken a recent hit with Congress voting not to extend that section of the Treasury program. Similarly, while expiration of the loan guarantee, the production tax credit and the investment tax credit programs are imminent, these items fueled a 33 percent increase in wind energy in 2011 from prior year’s levels. Frost & Sullivan said the market is vulnerable to a severe halt in production if these incentives are not extended and could result in a diminished ability for renewables to meet energy supply goals by 2020.

“With the anticipated recovery of the American economy, an improvement in the standard of living is expected, which is linked to increased uses of electronics and domestic appliances that further increase the country’s energy consumption,” Benedetti said.

Stay Informed Join our Newsletter

Having trouble finding time to sit down with the latest issue of
ELECTRICAL CONTRACTOR? Don't worry, we'll come to you.