I’m old enough to remember when about 15 years ago, the conventional wisdom was that fossil gas (what some folks still call “natural gas”) would be the “bridge fuel” to clean technologies like solar, wind and storage.
At the time gas had become cheap enough to build widely, was outcompeting coal on price, and had in some measures a lower carbon footprint than coal.
(certainly a lighter footprint in the other air pollution measurables).
Now, times have changed.
In a recent earnings call, NextEra CEO John Ketchum advised listeners that solar and wind are now the “bridge” to what comes next in generation.
That’s because supply chains for new gas turbines are jammed up, lead times for new plant construction are now longer than ever, nuclear is a decade away at scale, but new demand is coming on like a freight train.
- Solar and energy storage remain the cheapest options for meeting growing electric demand as costs and development timelines for new natural gas plants grow, NextEra Energy President and CEO John Ketchum said during a Wednesday morning earnings call.
- The cost to build a new natural gas plant has already tripled in the last few years and could increase even further due to new tariffs, Ketchum said. He later added during a Q&A with analysts that the time to build a new natural gas plant has grown from four and a half years to six or more years.
John Ketchum, CEO NextEra – FIRST QUARTER 2025 EARNINGS CONFERENCE CALL:
Let me explain. Energy realism is about embracing all forms of energy solutions and understanding the demand for electricity in the United States is here now and it’s not slowing down.
Frankly, it’s unlike anything we’ve ever seen since the end of World
War II.
Energy pragmatism is about recognizing some technology is ready
at scale today and other technology needs more time to get there – and
there will be significant tradeoffs with regard to the timing and cost of each.
Today, renewables and battery storage are the lowest cost form of
power generation and capacity. And we can build these projects and get
new electrons on the grid in 12 to 18 months. We should be thinking about
renewables and battery storage as a critical bridge to when other
technology is ready at scale, like new gas-fired plants.
We expect 75 gigawatts of new gas to come online between now and 2030. That is significant, for sure, but nowhere close to meeting the over 450 gigawatts
of total generation we believe are needed.
It’s also important to understand that gas-fired plants will come online at a higher cost than renewables and storage. That’s because gas turbines are in short supply and in high demand. It’s also proving difficult to re-establish the highly skilled workforce required to build these complex power plants. Gas-fired, combined cycle plants rely on approximately 1,000 workers across dozens of niche trades.
We’ve learned EPCs are hiring thousands of extra people to address high
washout rates, with some workers leaving earlier for higher paying jobs
building, for example, LNG terminals, data centers, semiconductor chip
manufacturing facilities and other industrial facilities. Other workers are
showing up to job sites without the necessary skills.
All of this puts upward pressure on prices and the time to build gas plants. It’s why the cost to build a gas-fired plant has tripled in the last few years – and is poised to increase even further due to tariff exposure.
We believe nuclear will continue to play an important role in meeting
demand. But again, we need to be practical about when that will happen.
There are limited opportunities to restart shuttered nuclear units. Two are
under way in our sector and we continue to evaluate bringing our own
Duane Arnold facility in Iowa back online. Beyond those limited
opportunities, SMR technology is still ten years away at scale in the best of
scenarios and at a much higher price point than gas-fired generation.
There’s also an option to defer coal retirements to meet demand. But,
even if we kept online every coal plant in America slated to retire, it would
only add approximately 40 gigawatts to the grid. And many are months
away from retirement or are already slated to be converted to gas. Again,
far short of the over 450 gigawatts needed between now and 2030.
Recognizing that most readers of this blog will not view more gas generation as the most desirable future fuel – but I think the point here is that solar, wind and battery are actually the only near term solutions to meeting demand at a cost that consumers can afford, and we should not view them as frills and luxuries to placate the tree huggers.
With the speed at which energy realities are changing, accelerating the deployment of wind and solar could well change the conversation that we are having in 3 to 5 years time – as there is some debate as to whether the purported new demands from data centers will actually be as extreme as advertised, and renewable prices will continue to fall.
In addition, one of the only emission free technologies favored by the current administration, advanced geothermal, is tracking similarly to what solar was a dozen years ago in terms of costs, and could very well in 5 years be a game changer that will compete favorably with both fossil gas and nuclear.
Meanwhile, climate impacts continue to increase and will inevitably continue to affect the conversation.
It’s not an ideal scenario, but its all I got right now.
So it looks like the limiting factors are (1) transmission, and (2) connection backlogs.
Don’t forget land.
There’s enough space on rooftops alone, especially warehouses and big stores, to combine with offshore wind, some geothermal and tidal, and existing hydro to supply all the energy the US needs. In fact, offshore wind alone could supply all we need. Drastic reduction in transmission needs, too.
What happened to my comment? I can’t find it.
The NREL disagrees with your statement, saying that IF we put solar on every rooftop that could use it efficiently, it would supply only 40% to 45% of todays – not tomorrow’s – US electricity needs:
https://www.nrel.gov/docs/fy16osti/65298.pdf
It would also be the most expensive way to produce solar energy. According to Lazard’s, rooftop solar is 2to 4 times more expensive than Utility-scale:
https://www.lazard.com/media/xemfey0k/lazards-lcoeplus-june-2024-_vf.pdf
Somebody once said “There’s enough space on rooftops alone, especially warehouses and big stores, to combine with offshore wind, some geothermal and tidal, and existing hydro, to supply all the energy the US needs. In fact, offshore wind alone could provide all we need.”
(Land generator maps offshore wind, NREL, and other sources)
Big rooftop solar projects like warehouses, distribution centers, and big stores are generally priced between residential and utility solar.
David Roberts wrote an excellent article about DERs in which he pointed out that distributed solar makes the whole energy system more affordable, ie, reduces the cost of energy. I don’t have access to my notes so can’t cite it more exactly.
The cost to build a new gas burner has tripled and will go up more with tariffs, as build times for fossil and fissile fuels increase. Of course that hardly matters since we have to stop burning fossil fuels immediately and nukes, with a dozen fatal conditions, can’t come anywhere close to doing the job civilization depends on. Efficiency, wiser lives, and clean safe healthy ecological fast cheap reliable resilient democratic water-wise renewable energy is the solution.
“Don’t forget land.”
Solar arrays fit in odd packages and in available land. For all of the complaints about solar taking up land, I’ve only heard of it being a problem in theoretical arguments. Solar farms are good cover for aquifer recharge zones, take up a tiny fraction of the ethanol corn they should be replacing, are easy to install and remove, and share space with healthy habitats. (They don’t need big parking lots to support operations and maintenance teams, either.)
Conversely, what makes transmission difficult is all of the land from rights of way for HV power lines that march across the landscape. High voltage transmission rights of way have easement widths ranging from 30 to 65 meters:
https://www.ausnetservices.com.au/safety/living-with-transmission-lines
And those transmission, pipeline, and other land needs are much worse with fossil fuels than with rooftop wind and offshore solar.
“And those transmission, pipeline, and other land needs are much worse with fossil fuels….”
Aye, look at the satellite pix of surface coal mines or the area around Midland, Texas. And you don’t have significant cleanup cost for retiring solar farms like the remediation needed for o&g wells or coal mines.
It’s not as if we have to look at solar farms (plant hedges along the roadway if it matters), but we do get exposed to combustion products and tainted aquifers whether we like it or not.
Note that with the huge efficiencies of renewably-powered EVs, heat pumps, etc. that 450 GW “needed” by 2030 becomes 200 GW. Outlawing the energy-wasting, inequality-creating wealthy indulgence of cryptocurrency would help even more.