Clean Energy Installs Dropped 55% in Q2

Clean Energy Installs Dropped 55% in Q2

According to a new report from American Clean Power (ACP), clean energy installation has declined by 55% from last year, making this quarter the lowest for added clean energy capacity since 2019. Solar installations went down by 53%, and onshore wind development plummeted by 78% from Q2 last year.

A perfect storm of inflating commodity prices and operating costs, pandemic-caused delays, regulatory and policy uncertainty, and supply chain issues have been buffeting the industry all year. In a recent report, the International Energy Agency (IEA) predicted that renewable power growth would slow in 2023 due to policy headwinds that could make the industry more unstable. President Biden's Build Back Better legislation, which was delayed all year and declared dead until Senator Manchin’s reversal, included hundreds of billions of dollars in economic help through tax credits for clean power. Meanwhile, solar projects were severely impacted as the Department of Commerce investigated the specious claim that imported panels from Southeast Asian countries circumvented tariffs on goods made in China, causing Customs and Border Protection agencies to impound solar panels from China to investigate human rights allegations involving wafers and the sands used in that production.

Now This: How the GOP Has Changed on Climate Change, July 16, 2021.

"Congressional inaction and uncertainty on long-term tax policy, tariff and trade restrictions, and transmission constraints all impact the demand for clean energy at a time when we need to be rapidly scaling up development,” said ACP CEO Heather Zichal. "Our member companies are ready to make the investment decisions necessary for building America’s clean energy economy, but the current business and policy environment is slowing the rate of deployment.”

CNBC: US is 30 years behind on renewable energy investments, says former Rep. Donna Edwards, May 10, 2022.

CNBC: US could generate 40% of its electricity using solar by 2035, September 24, 2021.

Bloomberg: Scaling Up Renewable Energy Usage, March 16, 2022.

Why This Matters

A recent study found there’s a 50-50 chance of the earth breaking the 1.5-degree Celsius limit and that phasing out fossil fuels for renewable energy sources is the best prevention of such a fate. Ramping renewables and maintaining momentum are also integral to meeting Biden’s ambitions to cut planet-warming greenhouse gas emissions by at least 50% below 2005 levels by 2030.

Further, clean energy would be a boon for the economy if slated projects reach commercial operation. As stated in the ACP’s 2022 Q2 report: "[Since 2021] more than 32.4 GW of clean power projects have … not yet achieved commercial operation. That's enough energy to power 6.5 million homes and support 110,000 jobs, and it represents $45 million in investment -- much of which flows to local communities.”

DW: Time is running out: WMO warns 1.5 degree threshold could be topped by 2026, May 18, 2022.

Bloomberg: Record Methane Levels Made 2021 5th Hottest Year Since 2000, January 10, 2022.

International Renewable Energy Agency: World Energy Transitions Outlook 2022, March 22, 2022.

The Economist: See what three degrees of global warming looks like, October 30, 2021.

The Good News

Clean power had been booming last year and still at the beginning of this year, which shows what’s possible when the country prioritizes renewable energy installation. A Department of Energy report from earlier this month found a 4% increase in jobs in the energy sector between 2020 and 2021, outpacing other overall US employment. It also found that zero-emissions industries (solar, wind, and nuclear) now make up 41% of energy jobs.

In 2021, 38% of the world’s electricity was generated by renewable sources, and the US eclipsed 200 GW of total operating utility-scale clean power capacity. According to ACP, it was also the second-highest year for renewable energy installations, and renewables were so cheap to install that even the oil-rich, fiscally-driven battleground state of Texas led the pack in increasing clean energy capacity.

The momentum continued in 2022 Q1, with clean energy storage installations up by 173% and solar by 11% compared with Q1 of the previous year.

CBS: How the new clean energy bill would combat climate change, July 28, 2022.

Bloomberg: Solar Energy Demand Set to Surge in 2022, July 27, 2022.

PBS: Why Oil Country is Turning to Wind Power, May 13, 2021.

NBC: Extreme Heat Raises Concerns About US Power Grids, June 17, 2022.

WW0: Heather Zichal and Amanda Little Facebook Live conversation, February 18, 2021.