Can we afford to supply 10 percent of electricity with non-hydro renewable sources by 2020?
Recent studies have shown that an RES of 10 percent by 2020 is easily affordable. A February 2002 study by the U.S. Energy Information Administration (EIA)—using high estimates of renewable energy costs—shows that an RES of 10 percent by 2020 would have virtually no impact on consumer electricity prices.2 In 2020, electricity prices would be only one-tenth of one cent per kilowatt-hour higher than business as usual under a 10 percent RES. Because an RES creates a more diverse and competitive market for energy supply, the EIA found that these market forces would reduce natural gas prices and bills, more than offsetting the slight change in electricity prices. Consumers could save $3.1 billion on their total energy bills compared to business as usual in 2010, and $3 billion in 2020 (Figure 1). Total consumer savings could be $13.2 billion between 2002 and 2020 (net present value). Other studies, using more realistic renewable energy cost assumptions developed by the Department of Energy’
