2023 Power Sector Trends
The energy transition into clean energy has ramped up throughout the United States, bringing the Inflation Reduction Act – a variety of tax credits and other incentives – with it. Governments and corporations are motivated to implement decarbonization goals while driving renewable and energy storage options.
However, some hiccups in the road, including supply chain complications, inflation, soaring interest rates, and an anti-dumping solar trade have stalled the transition a bit. Despite the setbacks, electric vehicles (EVs) are experiencing immense growth in sales, though some questions linger regarding how tax credits in the Inflation Reduction Act will be fulfilled.
Power systems in 2023 are anticipating three main challenges, according to Arne Olson, senior partner at Energy and Environmental Economics:
- Extreme weather conditions – heat waves, wildfires, and storms can cause severe damage
- Phasing out fossil fuels – coal, natural gas, petroleum, etc.
- Supply chain – delays the development of new resources
Utilities and lawmakers are tediously trying to battle these challenges by updating load forecasts based on weather patterns and more.
EV sales almost doubled in 2022 and could double again in 2023 as billions in federal incentives hit the market. Thanks to the Biden-Harris Electric Vehicle Charging Action Plan, EV infrastructure was boosted by $7.5 billion to implement a national network of 500,000 vehicle chargers.
Throughout 2022, the solar industry saw reduced growth because of ongoing global supply chain disruptions and the enactment of the Uyghur Forced Labor Prevention Act. Solar Company Hanwha Q Cells announced in early 2023 it will commit $2.5 billion to develop its solar production in Georgia.
The hydrogen industry saw immense growth in 2022, much due to the 2021 Department of Energy’s bipartisan infrastructure law, which injected $8 billion into the hydrogen clean energy program. This was closely followed by the Inflation Reduction Act, which offered novel tax credits for low-carbon hydrogen production.
Energy storage is slated to produce massive growth in 2023 as governments expand their carbon reduction goals. According to the U.S. Energy Information Administration, wind and solar are in high demand as developers and power plant owners look to increase utility-scale battery storage capacity by four times in the next three years.
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Written by the digital marketing team at Creative Programs & Systems: https://www.cpsmi.com/