Coal Is on the Decline and Renewables Are Soaring!

For the first four months of this year the US produced more energy from renewable sources than coal. It’s for the first time in over 135 years. 

(Then what source produced the most energy 135 years ago? Wood!)

Nobody has expected this day would come so soon. A decade ago, nearly 50% of the nation’s energy was provided by coal. It was the major source of the nation’s energy production. What was the other half?  The other half of the energy resources included  natural gas, wind, solar, hydroelectric dams, and geothermal. These renewable resources were comparably expensive than the cost of coal so people didn’t use them much. 

What has caused this transformation (coal to renewables) in the energy industry? 

It has been mostly driven by the decline of the cost of renewable energy. It has gotten much cheaper to produce electricity from renewable resources than from coal. So many plants use renewable sources to produce electricity. The cost of building power plants that use renewable energy has declined too. Building huge wind farms has gotten 40% cheaper and the price of solar energy has dropped 80% since 2010. Newly developed technologies also have helped lower the cost of green energy production so far. Compared to the big price change in the green energy industry, the coal mining industry hasn’t experienced any huge change. 

Is the lower price the only reason that caused this huge transformation?

No. That’s not all that has made the difference. There’s one more factor that has made all of this possible.

It’s the coronavirus outbreak.

This year has been so much different from the past years. Because everyone in the world is facing a global pandemic. The virus that started from a market in China suddenly spread all around the world. It is so contagious and lethal for some people. So most of the countries  have decided to shut down for a while. As a result, people are asked to stay at home by the government. Schools have closed. Shops and restaurants in town have closed. And most of all, a lot of factories and offices that consume much of the electricity supply have shut down. Due to this lockdown and shutdown, the demand for electricity has fallen very sharply. If it had not been for the coronavirus pandemic, we might not have seen this dramatic change in the energy industry.

Will this transformation last forever?

Some experts say that coal might come back soon. If the country reopens its factories, shops, and offices the demand for electricity will rise soon. For now natural gas which is a substitute for coal is meeting the demand at a lower price but if the natural gas price rises up, people might choose to use coal instead. 

Even though the demand for coal might come back, it’s not going to takeover natural gas because there are concerns  over air pollution and climate change. Now large power companies which were worried about the lack of technology and price are planning to retire their coal plants by 2025. It’s about time!