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Global Futures Report 2013 - United States

46 RENEWABLES GLOBAL FUTURES REPORT 05 Futures at the National and EU Levels United States Scenarios show a wide range of long-term market growth for renewable energy technologies in the United States. (See Table 3.) However, many U.S. experts foresaw great policy uncertainty beyond 2013 and believed that long-term renewables markets in the United States will be strongly tied to how policy decisions get resolved in the coming years. These experts wondered about exten- sion of the Investment Tax Credit (which expires in 2016) and the Production Tax Credit (which was to expire in 2012 for wind and in 2013 for other technologies), as well as air quality regulations, carbon policies (or lack thereof), and fossil fuel subsidies.9 Many policy experts pointed to continuing strong state-level policy support as the foundation for continued growth in future markets, including Renewable Portfolio Standard (RPS) policies in a majority of states, as well as a variety of other subsidies and support mecha- nisms at the state level. Experts also were quite certain that new utility regulations were coming, at both the state and federal levels, to facilitate the integration of renewables at higher shares on power grids, including “smart grid” planning and grid management.10 Some U.S. solar experts foresaw growing solar PV markets regardless of policy outcomes, as unsubsidized solar PV reaches “grid parity” with residential electricity rates over the coming decade in more and more states, starting with high-rate states like Hawaii and California. (See solar PV in Chapter 6 for more discussion of grid parity.) One expert projected a huge increase in solar PV capacity in the com- ing years, from 70 GW in 2015, to 100–140 GW by 2020, to several hundred GW by 2030. (For comparison, 4 GW existed in 2011.) Going even further, the Lovins/RMI (2011) “Transform” scenario shows 700 GW by 2050 in a fully half-decentralized energy system.11 Still, many experts acknowledged the large impact that U.S. fed- eral policy would have on future markets. For example, one expert projected an annual market of 5–6 GW per year by 2020 if the Investment Tax Credit were extended, but much slower growth in the absence of the credit. (For comparison, the annual market was 1.9 GW in 2011.) Another expert emphasized the role of state net metering policies and other state-level support in future markets, with or without the Investment Tax Credit. Some experts foresaw a broad array of applications for solar PV beginning to boom in the period 2013–2015, especially for commercial rooftops, which soon would capture half the market, some said.12 Likewise, U.S. wind industry experts foresaw continued growth of wind power markets regardless of policy outcomes, but much faster growth and larger markets if the Production Tax Credit is extended beyond 2012. For example, one expert projected an annual wind power market of up to 15 GW per year over the coming decade with continuation of the credit, but only 2–4 GW per year if the credit expires and wind markets rely solely on state-level RPS policies for support. (For comparison, the annual market was 7 GW in 2011.) “We really need the [Production Tax Credit] in the U.S. for 10 more years to become competitive,” said the expert. Another expert added that the future of wind power also depends on whether state utility commissions take fuel price risk into account in regulatory frameworks.13 Japan Following the Fukushima nuclear accident in March 2011, Japan was in the process of finalizing its “national green policy strategy” in late 2012. Proposed versions of this strategy have targeted a complete phase-out of nuclear power by 2040, as well as a 30% share of electricity from renewables by 2030. Japan also enacted a milestone feed-in tariff policy in late 2011 that began to change perceptions of Japan’s renewable energy future, both within Japan and internationally. Markets for solar PV, wind, geothermal, biomass, and small hydro are all supported by the feed-in tariff. During 2012, there were regular announcements in the press of planned renew- able energy projects by Japanese companies, including dozens of planned megawatt-scale solar PV plants.14 Japanese policy targets for 2020 include 33 GW of solar PV, 9.5 GW of wind, 1 GW of geothermal, and 4 GW of biomass. Dozens of local governments throughout Japan also have targets for shares and amounts of renewable energy for their cities and regions. (This now includes Fukushima Prefecture, which is targeting a 100% renew- able energy share by 2040.) Japanese renewable energy experts Table 3: U.S. Renewable Power Capacity by 2030–2035 and 2050 in Recent Scenarios Sources: See Annex 2. Actual 2011 from REN21 Renewables Global Status Report, 2012. Some figures rounded to nearest 5 or 10 GW from original sources. CSP stands for solar thermal power. Wind Solar PV CSP Biomass Geothermal Ocean GW Actual 2011 Capacity for Comparison 47 4 0.5 14 3 0 By 2030–2035 DOE EIA Annual Energy Outlook (2012) 70 8 1 6 6 — IEA World Energy Outlook (2012) “New Policies” 160 70 10 40 8 1 IEA World Energy Outlook (2012) “450” 270 120 60 50 12 1 Greenpeace Energy [R]evolution (2012, U.S. edition) 650 390 140 1 50 15 By 2050 NREL Electricity Futures Study (2012) “80% ITI” 460 170 60 80 25 — Lovins/RMI Reinventing Fire (2011) “Renew” 500 480 80 40 15 —

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