When it Comes to Electrical Grid Decarbonization, Location Matters

In January 2021, the White House established a National Climate Task Force to help facilitate the organization and deployment of a government-wide approach to climate action. Within a year, the White House set ambitious long-term goals for decarbonizing the electrical grid in the United States. These goals are part of a broader effort to combat climate change and transition to a clean energy future. 

The White House has since identified the key goals and initiatives related to decarbonizing the electrical grid, including the transition to 100 percent clean electricity by 2035 and a deep investment in the U.S. energy infrastructure such that the electrical grid will reach net-zero greenhouse gas (GHG) emissions no later than 2050.

Pursuant to the decarbonization of the electrical sector, the Inflation Reduction Act (IRA) and Bipartisan Infrastructure Law represent the single largest investment in climate and energy in American history—including the funneling of billions of dollars toward the decarbonization of the U.S. electrical infrastructure through investments in renewable energy resources and technologies.

Market analysts have sought to temper expectations due to challenges related to engineering/procurement/construction company (EPC) and labor shortages, limited access to land and permits, inflation and commodity price volatility, interconnection costs and timelines, and supply chain constraints.

The prospect of decarbonizing the electrical sector is riddled with myriad economic, technological, political, and outright physical challenges. There will be unanticipated setbacks and some nascent technologies will offer staggering breakthroughs. Goals notwithstanding, the future has yet to be written. 

Forecasting Grid Decarbonization

The National Renewable Energy Laboratory (NREL) is one of the national laboratories of the U.S. Department of Energy and specializes in renewable energy and energy efficiency research and development. Among a wide range of information resources publicly available through NREL, the lab maintains a tool called Cambium. 

Through Cambium, NREL assembles structured data sets of simulated hourly cost and operational data for modeled futures of the U.S. electric sector with metrics designed to be useful for long-term decision-making. It was developed to expand the metrics reported in the NREL’s Standard Scenarios—which is an annually released set of projections of how the U.S. electric sector may be altered across a suite of different potential future outcomes. The Cambium data sets can be viewed and downloaded at https://scenarioviewer.nrel.gov/.

Cambium is a data-rich tool and offers a range of future scenarios for analysis. The tool can even incorporate the potential catalytic impacts of IRA investments. Cambium also offers state-specific forecasts by aggregating data from Cambium's 20 Generation and Emission Assessment (GEA) regions. The GEA regions cover the contiguous United States. They are based off of the U.S. Environmental Protection Agency’s eGRID regions, but are not identical to them due to the geographic structure of the models in the Cambium workflow.

Each State Has a Unique Grid Decarbonization Journey

Each state tells a unique story regarding its forecast toward a decarbonized energy sector. Consider the following scenario. The projected combustion emissions rate (in kilograms of carbon-dioxide equivalent emission per megawatt hour) for five states—West Virginia, Indiana, Texas, California, and New York—are directly compared using Cambium's 2022 Mid-Case scenario assuming no nascent technologies and with current policies maintained. In all cases, the states' combustion emissions rates drop considerably (Figure 1). In this scenario, the U.S. average combustion emissions rate (kg CO2e / MWh) of 371.9 in 2022 drops to 87.9 by 2050.

What might be the impact on the same 2022 Mid-Case scenario should we incorporate nascent technologies and a successful 95 percent decarbonization rate by 2050? We see an even deeper reduction in each state's combustion emissions rate (Figure 2). Under this scenario, the U.S. average combustion emission rate drops to 18.5 kg CO2e/MWh by 2050.

NREL's projection data brings to bear the impact of each state's energy resource mix, grid condition, and regulatory context. This underscores the impact of location regarding a building project's operational carbon intensity relative to grid-supplied electricity.