Green Energy Use in the United States: Where Are We?

Many wind turbines and a large solar panel array in a desert valley, mountains in the distance and blue sky above. Palm Springs, California, USA


Climate change is one of the most expensive chronic crises. According to the nonprofit Natural Resources Defense Council (NRDC), global warming could cost almost $2 trillion annually by 2100 because of its environmental impact. These include energy and water costs, hurricane damage, and real estate losses.

If carbon emissions in the United States continue to rise, global warming could later account for over 3.5% of the country’s gross domestic product (GDP). To avoid all these figures, America has to reduce its carbon footprint by 80%.

This explains why the country spends a lot of money on renewable energy. The question is, how is it doing in its investment?

The Good and the Bad

When it comes to renewable energy generation and use, it’s a mixed bag in the United States. According to the Energy Information Administration (EIA), fossil fuels still provide about 80% of the country’s energy.

Meanwhile, our World in Data website revealed that renewable sources took up only 8.7% share of primary energy in 2019. Compare that to other developed nations during the same period.

In Canada, the likes of wind and solar accounted for over 25% of its primary energy. Germany, which is less than 4% of the United States landmass, relied on at least 15% of its energy from renewables.

On the upside, renewable energy consumption in the United States is growing since 2007, based on the website’s graph. The EIA shared that the power generated with fuel gas will decline to 36% in 2021 and then 35% in 2022 after hitting 39% in 2020.

The Center for Sustainable Systems of the University of Michigan forecasts that by 2050, renewable energy consumption will reach 20 quads (quadrillion British thermal units). One quad can already serve about 10 million US households.

There are more pieces of positive news:

  1. Solar Energy Is Growing—and It’s Getting Cheaper

The reportlinker.com data showed that photovoltaic (PV) installations in the United States grew by over 20% over the year 2019. Although the demand for non-residential markets declined by 4% during the same period, the residential and utility sectors soared by over 15% and 35%, respectively.

States are also investing in solar power. In Idaho, it accounted for at least 3% of the state’s net energy generation in 2019. Solar panels in Boise are also getting more affordable.

Overall, solar photovoltaic power dropped by nearly 90% over the last 10 years since 2009, according to Our World in Data. This makes energy from coal plants over 175% more expensive than what these panels generate. The price drop has been beneficial for people living in Idaho’s more remote or rural areas.

  1. Tax Credits and Other Incentives Are Still Around

To encourage homeowners, entrepreneurs, and energy players to invest in renewables, the federal and state governments extend several tax credits and other incentives.

Two of these are production tax credit (PTC) and investment tax credit (ITC). PTC can decrease the federal income tax of the qualified tax-paying owners running renewable energy operations. The credit is inflation-adjusted and is based on the per kilowatt-hour the facility generates and provides to an unrelated taxpayer.

PTC is renewable and extendable. The most recent extension is under the 2020 Taxpayer Certainty and Disaster Tax Relief Act. It can grant as much as 60% tax credit based on the electrical output’s full rate for wind projects that begin in 2020 and 2021. This benefit will last for 10 years, based on the act.

On the other hand, ITC gives a tax credit of up to 30% of the renewable projects’ total capital costs, including solar, geothermal, and fuel cells. For those that will begin in 2021 to 2022, the tax-paying owner may claim around 26% of the costs as ITC.

  1. The United States Is Investing in Renewable Energy

According to Statista, the country’s value of renewable energy investments was worth $59 billion in 2019 after falling slightly to $47 billion the previous year. Nevertheless, these figures were way higher than how much America spent in 2004, a mere $6 billion.

Moreover, even during the Trump administration, the country’s green energy spending increased significantly, partly thanks to companies seeking to maximize the tax credits. In 2019 alone, the country invested over $55 billion, according to Bloomberg.

America still needs to do more to improve its use and generation of green energy. However, it has been making giant strides over the years. And as the demand increases, the incentive to invest in renewables may also increase as they become more accessible and affordable.

Meta title: US Green Energy Consumption: The Good and the Bad
meta desc: The United States still has a long way to go when it comes to maximizing renewable energy. However, it is making excellent strides. Here’s how the country stands in green energy consumption.