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4 of the Biggest Electricity Storylines from 2016

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This year, natural gas and renewables continued to have a growing impact on U.S. power generation. 

Here are four of the most important electricity storylines from 2016.

1. Power Sector Carbon Emissions Falls to Lowest Level in 25 Years

Last year, U.S. power sector carbon dioxide (CO2) emissions dropped to the lowest point since 1993. In 2016, mild weather and shifts in the U.S. generation mix helped tamp down the sector's carbon emissions even further.  

The U.S. Energy Information Administration (EIA) estimates that U.S. energy-related carbon emissions totaled 2,530 million metric tons from January-June 2016, which is the lowest level of emissions for the first six months of a year since 1991. After declining by 2.6 percent in 2015, energy-related carbon dioxide (CO2) emissions are projected to decline by 1.3 percent in 2016 and then increase about 0.9 percent in 2017.

2. Natural Gas-Fired Generation Tops Coal for First Time Ever

Natural gas continues to claim a larger share in the U.S. generation mix. According to EIA, the natural gas share of U.S. total utility-scale electricity generation will average 34 percent and 30 percent for coal in 2016. This marks the first time that U.S. natural gas-fired generation has exceeded coal generation on an annual basis. 

Last year, both fuels supplied about one-third of all U.S. electricity generation. As natural gas prices are projected to increase in the next couple years, natural gas and coal are currently forecasted to respectively generate about 33 percent and 31 percent of electricity in 2017. 

3. Solar and Natural Gas Lead All Added Generating Capacity

According to EIA's Electric Power Monthly, the U.S. electricity grid added about 26 gigawatts (GW) of utility-scale generating capacity this year. Altogether, solar (9.5 GW) and natural gas (8.0 GW) are expected to lead the way, making up more than two-thirds of total additions. 

For solar, the level of additions is significantly more than the 3.1 GW of solar added last year and would top the total added solar capacity for the past three years combined (9.4 GW from 2013-15). In the third quarter alone, the U.S. installed 4,143 megawatts (MW) of solar power, an impressive 99 percent increase over Q2 2016 and 191 increase over Q3 2015, making it the largest quarter ever for the U.S. solar installations. Altogether, the U.S. now boasts about 35.8 gigawatts (GW) of total installed solar capacity. 


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4. Energy Efficiency is Now the Third Largest Power Resource in the U.S. 

For decades, energy efficiency has played an important role in ensuring reliable and affordable power for customers. Now, according to the American Council for an Energy-Efficient Economy (ACEEE), it’s the third largest resource in the U.S. power sector. 

ACEEE examined total energy savings produced last year across three areas: utility sector energy efficiency programs, appliance efficiency standards and building energy codes. The results were staggering: since 1990, energy efficiency has saved consumers $90 billion annually on their electric bills, which is underscored by the fact that overall electricity demand has flattened while the U.S. economy has grown. Last year, energy efficiency accounted for 18 percent of U.S. electricity generation, only trailing natural gas (27 percent) and coal (27 percent). 

For a round-up of the year's other top energy trends, watch our interview with Direct Energy Business president John Schultz

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