According to U.S. Energy Information Administration (EIA) website publication on Short-Term Energy Outlook (STEO) January 2023 report:
Electricity consumption: We forecast that total consumption of electricity in the United States will remain fairly stable, falling by 1% in 2023 and then growing by just over 1% in 2024. We estimate that electricity consumption grew by 3% in 2022.
Most of our expected change in U.S. electricity demand occurs in the residential sector, where we expect retail sales will fall as a result of a milder summer in 2023 compared with 2022 with about 10% fewer cooling degree days. Residential electricity sales grow in 2024 because we expect 5% more heating degree days in 1Q24 compared with 1Q23. The forecast also reflects trends in the housing stock. Our forecast assumes the U.S. housing starts resume growing in 2024 after a sharp decline in growth in 2023.
Electricity generation: U.S. generation in our forecast largely follows consumption, declining in 2023 then rising in 2024. Generation from renewable sources is the main contributor of growth in U.S. electricity generation. The forecast share of U.S. renewables generation rises from 21% in 2022 to 24% in 2023 and to 26% in 2024. About two-thirds of this forecast increase in renewables generation comes from new utility-scale solar photovoltaic capacity, and most of the rest is from new wind projects. We expect the share of electricity generation supplied by natural gas to decrease from 39% in 2022 to 38% in 2023 and 37% 2024 while the share of electricity generated by coal will fall from 20% in 2022 to 18% in 2023 and 17% in 2024. The share of nuclear power generation remains close to 19% over the next two years.
Power generators plan to add 32 gigawatts (GW) of utility-scale solar photovoltaic (PV) in 2023 and another estimated 32 GW in 2024. We forecast that small-scale solar capacity will grow by 9 GW in 2023 and by 12 GW in 2024. Wind capacity increases by 6 GW in both 2023 and 2024. Battery storage additions to capacity in our forecast are 10 GW in 2023 and 9 GW in 2024.
Coal Markets: After increasing in both 2021 and 2022, we expect U.S. coal production to decline by 11% to about 530 million short tons (MMst) in 2023, and a further 6% to 500 MMst in 2024. The primary reason for the decrease is our forecast of an 11% reduction in coal consumption in the electric power sector in 2023 followed by a 3% reduction in 2024. That decline largely reflects almost 10 GW of coalfired capacity retirements in 2023 and another 4 GW in 2024. At the same time, renewable generation increases by 20% between 2022 and 2024, reducing coal-fired generation.
