2021 was a record-breaking year for investment in and deployment of clean energy, battery storage, and EVs in the US, according to the “2022 Sustainable Energy in America Factbook” published today by BloombergNEF (BNEF) and the Business Council for Sustainable Energy (BCSE).
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According to the study, growth was fueled by strong consumer demand; unprecedented injection of new capital into companies, technologies, and projects; and a wave of supportive new government policies.
Ethan Zindler, BloombergNEF’s head of Americas, said:
Last year really was a year of firsts. We saw record volumes of new capital deployed to support the transition to a lower-carbon economy, a record number of electric vehicles sold, and record contributions to the power grid from zero-carbon renewable sources of power. Still, there are plenty of open questions about future demand that clearer signals from Washington could resolve.
Here are three standout things that happened in 2021 for EVs, clean energy, and battery storage:
US electric vehicle sales doubled in 2021, but the US still lags globally. Thanks to lower battery costs, growing consumer acceptance, and the rollout of new models, EV sales saw 657,000 units sold in the US in 2021, which is more than double the 325,000 cars sold in 2020.
Tesla continued to account for the largest share of EV sales in 2021, at 50%. While the overall market expanded 34%, the market for non-Tesla electric cars grew 83%.
However, EVs made up just 4.4% of total US passenger vehicle sales in 2021. The US EV market is one-third the size of the European Union’s and one-fifth of China’s. The US market is not yet growing fast enough to satisfy either US climate ambitions, or to establish the US as an industrial leader in the EV sector.
In order for the US to meet its 2030 nationally determined contribution on emissions, EVs must make up at least 30% of vehicles on the road by that year. There’s still a very long way to go to meet that target.
Read more: Global market share of electric cars more than doubled in 2021 as the EV revolution gains steam
Private investment in clean energy in the US is accelerating. Investment of $105 billion in new private capital in the US energy transition in 2021 is an 11% year-on-year increase, and a 70% increase over the past five years. The 2021 total included $47 billion in clean energy (45%), $35 billion in electrified transport (34%), and a doubling of hydrogen investments to $200 million in 2021.
Large corporations continued to drive clean energy demand in the US, signing contracts to procure a record 17 gigawatts (GW) of clean energy in 2021. 351 companies pledged to procure 100% clean energy.
Further, private sector investment will be leveraged by the US federal government’s unprecedented $80 billion pledge to support the energy transition with the enactment of the Infrastructure Investment and Jobs Act.
And private investment in renewables is on an upward trajectory. For example, just today, Schenectady, New York-based clean energy company DSD Renewables announced it has secured a $200 million preferred equity investment from alternative investment manager Ares Management Corporation.
Read more: A Hawaiian macadamia nut farm gets solar and storage, achieving 100% renewable power
Clean energy and battery storage grew, but natural gas is still the leader for electricity generation. More than 45 GW of new power generation capacity was commissioned in 2021 – the largest capacity in nearly two decades. Clean energy dominated, adding 37 GW. Solar had its largest build year ever at 24.2 GW of new capacity, and wind followed at 13 GW, its third best year to date.
Further, close to 4.2 GW of battery capacity was added to the US grid in 2021, more than in all preceding years combined. This was due to the growing need for batteries created by the growth of clean energy, particularly solar, in certain markets, particularly California.
Overall, natural gas, at 38% is the largest source of US electricity generation. However, natural gas contributed 3.1% less than in 2020, due primarily to higher gas prices.
Clean energy provided 21%, with wind and solar representing 14% of this. Nuclear provided 19%, and coal provided 22%. Coal is down nearly 40% from a decade ago due to weak demand, coal plant retirements, and competition from cleaner sources. While coal use rose in 2021 for the first time since 2014, that is widely believed to be a temporary surge.
Read more: Clean energy was the No. 2 source of electricity in the US in 2020
BNEF/BCSE’s new 2021 study can be found here.
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Author: Michelle Lewis
Source: Electrek
