Wind Energy FAQs: GHG Emissions and Power Prices

Greenhouse Gas emissions and Power Prices (2005-2019)

One of the objections frequently raised, in opposition to efforts to reduce greenhouse gas (GHG) emissions from the power sector, is that it will place a significant burden on electricity users in the form of increased prices.

To check this, it is necessary to consider how power sector emissions, and power prices, have changed over the last few years. First, the emissions..

Carbon emissions. The Energy Information Administration publishes monthly data on carbon emissions from the power generation sector and we show them in the following graph, for the period from 2000 to end October 2019.

US GHG emissions

The chart shows annualized (i.e. emissions for the 12 months prior to the end of the month shown) US power sector emissions – by type – from January 2002 to September 2019. It shows that GHGs fell, from a March 2008 peak of 2,552 million tonnes, to a low of 1,786 million tonnes at the end of August 2019: a 30% decrease.

GHGs per unit of generation. Dividing total emissions by total generation gives emissions per unit of electricity and these have been steadily declining from 0.638 tonnes per megawatt hour (t/MWh) to a low in September 2019 of 0.429 t/MWh which is equivalent to 429 grams per kilowatt hour (g/kWh).

GHGs avoided by generator type. By comparing the average emissions of each type of generator with the average emissions of the power sector as a whole (429 kg/MWh as noted in the previous graph), it is possible to get an idea of the amount of emissions avoided by each type of generator. This information is shown in the following graph,

The previous chart shows that as system wide emissions approach the average for the gas-fired generation fleet, the emissions avoided by gas-fired plant – relative to the system average – fall towards zero.  Indeed, emissions avoided by gas have never been more than hydro, were overtaken by wind in January 2016 and by solar in August 2018.

Power prices.   The Energy Information Administration also publishes monthly data on national electricity prices. To ensure comparability, we inflation-adjusted all prices to November 2017 using CPI information from the Bureau of Labor Statistics, and include the chart as follows;

It demonstrates that over the period since 2005, inflation-adjusted electricity prices have been remarkably stable fluctuating from a low of 9.57 c/KWh in January 2005 to a high of 12.03 c/KWh in July 2008 and thereafter remaining largely unchanged from 2012 to the present day.

And from this data, it is reasonably clear that reducing power-system GHGs (and increasing the use of wind and solar) has not resulted in any significant change in electricity prices.