Analysts see renewable energy benefitting at gas, coal’s expense during current U.S. downturn FacebookTwitterLinkedInEmailPrint分享S&P Global Market Intelligence ($):As the U.S. economy slumps under the weight of the coronavirus pandemic, falling electricity demand is increasing financial pressure on fossil fuel plants and creating an opportunity for renewable energy resources to grab a bigger share of the market, according to analysts at S&P Global Market Intelligence.Declining costs for wind and solar farms have made clean energy competitive with traditional resources like coal and natural gas in much of the world. Now, the drop in demand in U.S. wholesale electricity markets is primarily threatening fossil fuel generators, and it is likely that low-cost renewable energy will “retain its position even if demand overall shrinks,” said Steve Piper, director of energy research at S&P Global Market Intelligence, during a May 15 webinar.“The pandemic could put another nail in the coffin for coal demand from the utility sector,” said Alex Cook, a senior energy research analyst at S&P Global Market Intelligence. “It could also put gas-fired units at risk and reduce gas demand, particularly in markets that have a high level of gas generation in their fuel mix, like New York and New England.”While coal and natural gas face growing risks, the safe-haven status of renewables has been reinforced during the health and economic crisis, investors say, since wind and solar plants often sell electricity under fixed-price, long-term contracts that help to shield their revenue from immediate economic disruptions.“So, we have confidence that these [power purchase agreements] will be honored by all our customers,” said Michel Letellier, president and CEO of Canada’s Innergex Renewable Energy Inc., on a May 13 earnings call. Meanwhile, Letellier said, investor interest in new renewable energy assets in the U.S. remains high and could accelerate due to the closure of inefficient or uneconomic fossil fuel units.“[Our] belief is that renewable generation is still going to be a key driver in the industry, and that’s primarily due to the fact that so many utilities have made these announcements in the past,” said Tod Cooper, COO of transmission and distribution at construction firm MYR Group Inc. “We know what their plans are going forward.”[Michael Copley]More ($): In the battle for market share, analysts see downturn boosting renewable energy
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