Rise of Renewable Energy

In a historic shift, solar and wind energy have surpassed coal as the primary source of electricity in the US. According to a report by Ember, a leading energy think tank, solar and wind energy combined accounted for 17% of the country's electricity generation, while coal fell to a historic low of 15%.

The growth of solar energy has been particularly impressive, with utility-scale solar growing by a record 31 gigawatts in 2024. This surge in solar energy production has been driven by declining costs, with solar energy reaching historically low costs in 2020 and becoming the cheapest source of electricity in most parts of the world.

Meanwhile, wind generation has also continued to grow, albeit at a more modest pace. Onshore wind is still approximately twice as large a source of electricity as solar, making up about 10% of the US electricity mix.

Challenges Ahead

Despite this progress, the US energy sector still faces significant challenges in its transition to renewable energy sources. The Trump administration's policies have been seen as hostile to renewable energy, with attempts to claw back funding for renewable energy projects and impose tariffs on goods from Canada and China.

However, market forces are expected to continue driving the growth of renewable energy, with electricity demand rising by 3% in 2024, the fifth-highest jump this century. The rise of energy-hungry AI data centers, crypto mines, and electric vehicles and appliances has led to growing interest in developing more sources of energy across the board.

Future Outlook

A report commissioned by a diverse range of trade groups, including the American Clean Power Association and the Nuclear Energy Institute, has highlighted the need for significant growth in the US power grid. The report estimates that the US will need to install 900 gigawatts of renewable energy and batteries by 2040 to meet growing demand.

While there is still much work to be done, the progress made in 2024 is a significant step towards a more sustainable energy future. As Ember chief analyst Dave Jones noted, 'Solar is winning,' and with the right policies and investments, the US can continue to drive growth in renewable energy and reduce its reliance on fossil fuels.

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