Renewable PPA prices rise, peak power prices expected to plunge: 2023 US power sector trends
Renewable PPA prices rise, peak power prices expected to plunge: 2023 US power sector trends | Utility Dive
U.S. average electricity prices tracked by the Bureau of Labor Statistics remained high through May, though down slightly from their 10-year record reached earlier this year helped by falling natural gas prices. A decline in gas prices is also expected to drive a significant drop in peak power prices across the U.S., while some parts of the U.S. power sector, like renewable PPAs, have been seeing price increases.
Renewable PPA prices rise, peak power prices expected to plunge: 2023 US power sector trends
Electricity prices have likely peaked, federal agency data and projections show, but some parts of the US power sector are continuing to see price increases.
U.S. average electricity prices tracked by the Bureau of Labor Statistics
- Renewable energy PPA prices continue to rise despite Inflation Reduction Act relief: LevelTen
Renewable energy prices continued their two-year climb after a brief reprieve at the end of 2022, according to the latest data from LevelTen’s energy marketplace.
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- Soaring electricity prices outrun inflation but have likely peaked as natural gas prices plunge: EIA, BLS
“The situation is getting worse as utility bills remain high and families are getting hit [by] rising prices for food and shelter,” said Mark Wolfe, executive director of the National Energy Assistance Directors’ Association.
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- Record-high electricity prices fail to boost residential energy management programs: JD Power
Time-of-use rates can help to engage customers with energy conservation programs, but utilities must be careful to explain how the new pricing structure works.
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- Lower gas prices to drive 35%-45% ‘plunge’ in 2023 peak power prices across most of US: Moody’s
California is the exception, where peak prices are expected to fall “only around 9%,” according to the ratings and financial research agency.
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- Electricity prices surged 14.3% in 2022, double overall inflation: US report
After peaking last summer, the price of residential electricity is projected to rise more slowly over the next two years, according to the Energy Information Administration.
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Related Knowledge Center: ENERGY BASICS: renewables
Renewable energy sources — once the fuel of the future, then practical in specific, narrow applications — are increasingly economic mainstream sources of power generation. Hydropower was long the mainstay of U.S. renewable electricity generation, although wind power surpassed hydro for the first time in 2019, and solar continues its rapid growth. The continued growth of wind and solar, with their fluctuations, is tied in part to improvements in storage technology: batteries.