Wind surpasses both coal, nuclear for first time March 29 in Lower-48 generation mix: EIA

Wind power was the second-largest source of electricity generation in the Lower-48 states March 29, surpassing, for the first time, both coal and nuclear on the same day, the US Energy Information Administration said April 14.

Gas-fired generation was the top power source that day, producing 3,287 GWh of generation, followed by wind output of 2,017 GWh, according to EIA's Hourly Electric Grid Monitor. Nuclear produced 1,989 GWh, coal produced 1,822 GWh, and all other sources combined produced 1,373 GWh of electricity March 29, EIA said

The influx of wind translated to wind penetration records and low prices in some regional transmission organizations. Southwest Power Pool reported a wind penetration of 88.5% March 29, and the Electric Reliability Council of Texas reported a wind penetration of 67.2% that day, EIA noted.

Capture prices

Renewable capture prices fell in both regions, driven by strong wind penetration.

Wind at the SPP North Hub was valued at $5.20/MWh March 29, trending below the March average of $13.84/MWh, while South Hub was priced at $10.05/MWh, falling from the monthly average of $20.85/MWh, S&P Global Commodity Insights data showed.

SPP wind capture prices moved alongside the regional wholesale electricity price, which also priced low March 29. The daily baseload price at SPP North Hub averaged $5.47/MWh, and South Hub was at $10.58/MWh that day. Hourly prices at both hubs traded below zero during early morning hours, reaching as low as minus $18/MWh for South Hub at the hour ending 3 am Central, S&P Global Market Intelligence data showed.

In ERCOT, the West Zone wind capture price slid to $9.43/MWh, and the South Zone remained in the negative, at minus $21.55/MWh that day. Looking at March as a whole, the average price for wind at the West Zone was $17.65/MWh, while the South average was seen at a steep discount of $3.86/MWh, depressed by periodic negative prices in the region.

S&P Global Renewable Capture Price Indexes track the value that renewable energy generators capture for the electricity they produce throughout the day, based on hourly generation and ISO's pricing data.

Shifting capacities

As more wind capacity gets built out, it can be expected that wind generation will continue to compete with and overtake coal and nuclear generation on a more frequent basis, said Tyler Jubert, a power market analyst with S&P Global.

EIA's March 29 estimate came at a time when coal and nuclear were already dropping as they typically do coming out of the winter, Jubert noted. Nuclear generation began decreasing rapidly toward the end of March because of seasonal maintenance-related outages, he said.

But wind capacity additions and coal and nuclear retirements are also playing a significant role, he said. "Our latest short-term forecast has tracked an incremental 21.5 GW in total US wind capacity that has come online between March 2021 and March 2022," Jubert said. During that time, there were 4.8 GW of coal capacity retirements, he said.

There are another 12.5 GW of coal retirements expected from April through the end of the year, although some retirements will likely carry into 2023 given the recent increase in fuel prices and the potential need for coal generation next winter, Jubert said.

"At the same time, there is an incremental 10 GW of wind capacity across the US that could come online between now and the end of the year, which supports our outlook that wind generation will continue to increase in market share," he said.

Wind trends

EIA said that wind has beat out coal and nuclear separately on other days earlier this year, but EIA data shows this is the first time ever that wind surpassed both sources on a single day. EIA's data goes back to July 2018, Chris Higginbotham, an EIA spokesperson, said in an email.

On a monthly basis, there is less wind generation in the Lower-48 states than gas-fired, coal-fired, or nuclear generation, EIA said. "We do not expect wind to surpass either coal-fired or nuclear generation for any month in 2022 or 2023, based on our most recent Short-Term Energy Outlook forecast," EIA said.

While wind capacity surpassed nuclear capacity in September 2019, the average capacity factor for wind generators is 35% and the average capacity factor for nuclear is 93%, according to EIA's 2021 data. "Wind turbines currently rank as the third-largest source of generating capacity in the United States, behind natural gas-fired generators and coal-fired generators," EIA said.