Construction Cost Changes: Wind, Solar, Natural Gas // UAE: Oil Industry In "Decline Mode"

Construction Cost Changes: Wind, Solar, Natural Gas

Wind, solar, and natural gas made for over 95% of the capacity added to the American electric grid in 2020. That same year, investment in electrical generating capacity rose a whopping 40% to $46.3 billion compared to 2019. Here's what the Energy Information Administration has to say about how these technologies are faring.

"Construction costs for solar photovoltaic systems continued to decrease in the United States in 2020; the capacity-weighted average fell 8% compared with 2019," reports the EIA. "By contrast, average construction costs for both wind turbines and natural gas-fired generators increased compared with 2019, by 8% for wind and 4% for natural gas."

Solar's 8% drop in construction cost to $1655 per kilowatt in 2020 is largely attributable the fact that cadmium telluride tracking panels dropped in cost by 17% to $1631 per kW, their lowest since 2014.

The average construction cost of crystalline silicon fixed-tilt panels also fell by 13%, though they remained the most expensive solar tech at $1957 per kW.

"The majority of solar panels installed in the United States are crystalline silicon tracking panels. Unlike fixed-tilt systems, solar tracking systems move to follow the sun as it moves across the sky, allowing for greater electricity production. A majority of tracking panels in the United States are single-axis tracking systems," reports the EIA.

In 2020, crystalline silicon tracking systems made up 61% of the utility-scale solar capacity deployed. Their construction costs increased by 6% that year to $1587 per kW.

Onshore wind's cost leaped 8% in 2020 to $1498 per kW.

"The two largest wind-farm size groups accounted for 95% of the wind capacity added to the U.S. power grid in 2020," reports the EIA. "The average construction cost for the largest wind farms—those with more than 200 megawatts (MW) of capacity—increased by 11% to $1,393 per kW. Wind farms ranging from 100 MW to 200 MW were the only group to decrease in average construction costs in 2020, from $1,615 per kW in 2019 to $1,531 per kW in 2020, down 5.2%."

Between 1 MW and 100 MW of capacity, wind farms saw an average construction cost increase of 53% to $2530 per kW in 2020.

"The average construction cost for natural gas-fired generating plants rose 4% from 2019 to 2020. The majority of natural gas electric-generating capacity installed in 2020 came from combined-cycle facilities. The average combined-cycle generator construction cost increased by 22% in 2020 to $1,155 per kW, up from $948 per kW in 2019," the EIA reports.

UAE: Oil Industry In "Decline Mode"

“To assume oil is going to be there forever is wishful thinking,” the United Arab Emirates Energy Minister Suhail Al-Mazrouei told an audience of the UAE's young energy workers at the ADIPEC energy conference. “No matter how much we defend it, it’s in decline mode."

The UAE is one of the most influential and important members of OPEC+.

Al-Mazrouei told the young workers to focus on energy more generally, not just oil. Of course, the UAE will provide the world with crude for as long as it's needed, he assured them. The Persian Gulf is executing a multi-billion dollar investment in raising its production capacity so that it can capitalize on fossil fuel demand.

Yet the UAE is pivoting towards cleaner energy itself, including building nuclear power plants. The country already has four AP1400 nuclear power reactors (three running, one preparing to switch on) at its Barakah nuclear power plant. The UAE hopes to end carbon emissions within its borders by 2050.

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