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The Clean Power Plan made "easy": WECC Power & Renewables long-term outlook H2 2016

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09 February 2017

The Clean Power Plan made "easy": WECC Power & Renewables long-term outlook H2 2016

Report summary

Original analysis of the Clean Power Plan (CPP) a little over a year ago suggested it could result in fairly high compliance costs in the eastern US relative to a “No Carbon” (No CPP) case.  In our latest forecast, a downward revision to our long-term natural gas prices and load growth translates into lower carbon prices. These effects also help keep power as well as renewable energy credit prices relatively contained. Despite these trends, renewables growth remains largely unchanged as lower market prices are mitigated by higher state mandates and falling cost of renewables. As markets move towards a new energy paradigm with renewables both on and off grid, battery storage, demand response, electric vehicles -- the challenge of integrating diverse sources and maintaining system reliability are taking centerstage.  Market mechanisms and compensation schemes are also evolving rapidly in concert.

Table of contents

    • Despite stable GDP projections, regional demand trends remain under pressure
    • Energy Efficiency (EE) and Distributed Solar (DG Solar) continue to constrain overall load growth
      • EE
      • Distributed Solar
      • With EVs providing long term upside
    • Despite a near term bump in natural gas prices, the long term outlook reverts back to continuing pressure from low cost supplies
    • As coal demand follows the shift in the natural gas paradigm
    • Although carbon emissions have already been sharply reduced, long term fundamentals find room to keep carbon prices contained
    • Natural gas generation now expected to permanently surpass coal generation as early as 2019
    • Wind and solar continue to absorb market share
    • Despite increasing renewable output and efforts to increase transmission access, lack of transmission expansion still expected to inhibit renewable integration
    • Coal retirements in the near to mid term continue to clarify
    • Nuclear capacity looks to out of market revenues for support
    • Despite lower loads, more new gas capacity is expected to be needed over the forecast horizon
    • Reserve margins remain in flux
    • Regional energy prices absorb the combination of weaker demand, lower natural gas prices, and nominal carbon pricing
    • Capacity markets continue to evolve
      • PJM Reliability Pricing Model
      • MISO Resource Adequacy
      • New York ICAP (Installed Capacity) market
      • ISO New England Forward Capacity Market (FCM)
      • Capacity Markets to grow? : Canadian Capacity Markets
      • Capacity Prices for other Markets - California
      • REC Markets
    • Conclusion

Tables and charts

No table or charts specified

What's included

This report contains:

  • Document

    WECC Regional Market Outlook.pdf

    PDF 1.92 MB

  • Document

    NAPS LTO Report 1 31 2017 Appendix Modeling Enhancements.pdf

    PDF 837.64 KB

  • Document

    WoodMac NAPR Topology 2016H2.pdf

    PDF 486.98 KB

  • Document

    NAPS LTO Battery Cost Forecast WECC 1 31 2017.xlsx

    XLSX 100.86 KB

  • Document

    NAPS LTO Capacity Prices WECC 1 31 2017.xlsx

    XLSX 279.22 KB

  • Document

    NAPS LTO Coal Clean Equipment Data WECC 1 31 2017.xlsx

    XLSX 191.70 KB

  • Document

    NAPS LTO Coal Retirements WECC 1 31 2017.xls

    XLS 90.00 KB

  • Document

    NAPS LTO Delivered Fuel Prices Nominal WECC 1 31 2017.xlsx

    XLSX 483.53 KB

  • Document

    NAPS LTO Delivered Fuel Prices Real WECC 1 31 2017.xlsx

    XLSX 489.60 KB

  • Document

    NAPS LTO Emission Prices Nominal WECC 1 31 2017.xlsx

    XLSX 121.38 KB

  • Document

    NAPS LTO Emission Prices Real WECC 1 31 2017.xlsx

    XLSX 121.64 KB

  • Document

    NAPS LTO Emissions WECC 1 31 2017.xlsx

    XLSX 175.72 KB

  • Document

    NAPS LTO Load Forecast WECC 1 31 2017.xlsx

    XLSX 2.74 MB

  • Document

    NAPS LTO Macroeconomics WECC 1 31 2017.xlsx

    XLSX 103.43 KB

  • Document

    NAPS LTO Prices Sparks IHR Darks Nominal WECC 1 31 2017.xlsx

    XLSX 5.82 MB

  • Document

    NAPS LTO Prices Sparks IHR Darks Real WECC 1 31 2017.xlsx

    XLSX 7.58 MB

  • Document

    NAPS LTO Renewable Energy Credit Prices WECC 1 31 2017.xlsx

    XLSX 141.51 KB

  • Document

    NAPS LTO Solar DG WECC 1 31 2017.xlsx

    XLSX 88.85 KB

  • Document

    NAPS LTO State RPS Targets WECC 1 31 2017.xlsx

    XLSX 680.95 KB

  • Document

    NAPS LTO Supply Demand Energy WECC 1 31 2017.xlsx

    XLSX 1014.32 KB

  • Document

    NAPS LTO Transmission Projects in Base Case WECC 1 31 2016.xlsx

    XLSX 83.18 KB

  • Document

    The Clean Power Plan made "easy": WECC Power & Renewables long-term outlook H2 2016

    PDF 768.84 KB

  • Document

    The Clean Power Plan made "easy": WECC Power & Renewables long-term outlook H2 2016

    ZIP 20.77 MB

  • Document

    Executive summary

    PDF 768.88 KB

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