One of the key updates in the U.S. Energy Information Administration’s early release reference case for its 2011 Annual Energy Outlook (AEO) was an update of anticipated power plant capital costs that is good news for solar but bad news for nuclear and integrated gasification combined-cycle (IGCC) power.

The early release anticipates that non-hydro renewable sources will grow nearly three-fold, meeting 23% of projected electricity generation growth by 2035.

The outlook for nuclear is less rosy: "Nuclear generating capacity in the AEO2011 Reference case increases from 101 gigawatts in 2009 to 111 gigawatts in 2035, with 6.3 gigawatts of new capacity (5 new plants) and the balance coming from rerated capacity. Electricity generation from nuclear power plants grows 10 percent, from 799 billion kilowatthours in 2009 to 879 billion kilowatthours in 2035, accounting for about 17 percent of total generation in 2035 (compared with 20 percent in 2009). Higher construction costs for new nuclear plants in AEO2011, along with lower projected natural gas prices, make new nuclear capacity slightly less attractive than was projected in the AEO2010 Reference case."

The chart on page 17 of the EIA’s presentation indicates a 37% increase in nuclear capital costs. That increase is second only to the increase for IGCC with carbon capture and sequestration at 39%. Only selected renewable sources showed capital cost reductions: -25% for photovoltaic, -10% for solar thermal, and -2% for biomass.

The release, made on Thursday, is an abridged version of the AEO that highlights changes in the AEO Reference case projections for key energy topics. The early release includes data tables for the Reference case only. It also included a significant update of the technically recoverable U.S. shale gas resources, more than doubling the volume of shale gas resources assumed in AEO2010, and also added new shale oil resources. It also noted that U.S. carbon dioxide emissions are expected to rise slowly but not pass 2005 levels again until 2027.

In its summary note about electricity generation, the EIA early release states: "Non-hydro renewables and natural gas are the fastest growing electricity generation sources, but coal remains the dominant fuel because of the large amount of existing capacity."

The full AEO2011 will be released March 2011.

Sources: EIA