Energy
Visualizing the Flow of U.S. Energy Consumption
Breaking Down America’s Energy Consumption in 2020
This was originally published on July 6 2021, on Visual Capitalist.
The United States relies on a complex mix of energy sources to fuel the country’s various end-sectors’ energy consumption.
While this energy mix is still dominated by fossil fuels, there are signs of a steady shift to renewable energy over the past decade.
This radial Sankey diagram using data from the EIA (Energy Information Administration) breaks down U.S. energy consumption in 2020, showing us how much each sector relies on various energy sources.
The Balance of Energy Production and Consumption
In 2019 and now in 2020, America’s domestic energy production has actually been greater than its consumption—a development that hasn’t taken place since 1957.
Last year’s numbers were severely impacted by the COVID-19 pandemic, seeing a 5% drop in energy production and a 7% drop in consumption compared to 2019. Total energy production and consumption for 2020 came in at 95.75 and 92.94 quads respectively.
The energy amounts are equalized and measured in quadrillion BTUs (British thermal units), also known as quads. A quad is a huge amount of energy, equivalent to 183 million barrels of petroleum or 36 million tonnes of coal.
So how is America’s overall energy production and consumption split between energy sources?
U.S. Energy Production and Consumption Share by Source
| Energy Source | Percentage of U.S. Energy Production | Percentage of U.S. Energy Consumption |
|---|---|---|
| Petroleum | 32% | 35% |
| Natural Gas | 36% | 34% |
| Renewable Energy | 12% | 12% |
| Coal | 11% | 10% |
| Nuclear | 9% | 9% |
Source: IEA
America’s new margin of energy production over consumption has resulted in the country being a net total energy exporter again, providing some flexibility as the country continues its transition towards more sustainable and renewable energy sources.
Fossil Fuels Still Dominate U.S. Energy Consumption
While America’s mix of energy consumption is fairly diverse, 79% of domestic energy consumption still originates from fossil fuels. Petroleum powers over 90% of the transportation sector’s consumption, and natural gas and petroleum make up 74% of the industrial sector’s direct energy consumption.
There are signs of change as consumption of the dirtiest fossil fuel, coal, has declined more than 58% since its peak in 2005. Coinciding with this declining coal dependence, consumption from renewable energy has increased for six years straight, setting record highs again in 2020.
However, fossil fuels still make up 79% of U.S. energy consumption, with renewables and nuclear accounting for the remaining 21%. The table below looks at the share of specific renewable energy sources in 2020.
Distribution of Renewable Energy Sources
| Renewable Energy Source | 2020 Energy Consumption in Quads | Share of 2020 Renewable Energy Consumption |
|---|---|---|
| Biomass | 4.52 | 39% |
| Wind | 3.01 | 26% |
| Hydroelectric | 2.55 | 22% |
| Solar | 1.27 | 11% |
| Geothermal | 0.23 | 2% |
Source: IEA
The Nuclear Necessity for a Zero-Emission Energy Transition
It’s not all up to renewable energy sources to clean up America’s energy mix, as nuclear power will play a vital role in reducing carbon emissions. Technically not a renewable energy source due to uranium’s finite nature, nuclear energy is still a zero-emission energy that has provided around 20% of total annual U.S. electricity since 1990.
Support for nuclear power has been growing slowly, and last year was the first which saw nuclear electricity generation overtake coal. However, this might not last as three nuclear plants including New York’s Indian Point nuclear plant are set to be decommissioned in 2021, with a fourth plant scheduled for retirement in 2022.
It’s worth noting that while other countries might have a higher share of nuclear energy in their total electricity generation, the U.S. still has the largest nuclear generation capacity worldwide and has generated more nuclear electricity than any other country in the world.
Converting Energy to Electricity
The energy produced by nuclear power plants doesn’t go directly to its end-use sector, rather, 100% of nuclear energy in the U.S. is converted to electricity which is sold to consumers. Along with nuclear, most energy sources aside from petroleum are primarily converted to electricity.
Unfortunately, electricity conversion is a fairly inefficient process, with around 65% of the energy lost in the conversion, transmission, and distribution of electricity.
This necessary but wasteful step allows for the storage of energy in electrical form, ensuring that it can be distributed properly. Working towards more efficient methods of energy to electricity conversion is an often forgotten aspect of reducing wasted energy.
Despite the dip in 2020, both energy production and consumption in the U.S. are forecasted to continue rising. As Biden aims to reduce greenhouse gas emissions by 50% by 2030 (from 2005 emission levels), U.S. energy consumption will inevitably continue to shift away from fossil fuels and towards renewable and nuclear energy.
Electrification
Visualized: How the Power Grid Works
How does electricity get from the power plant to our homes? This infographic illustrates how the power grid works.
How Does the Power Grid Work?
Electricity is critical to our daily lives, but how does it get from the power plant to our homes?
The power grid is a complex interconnected system that powers the entire economy by carrying electricity from the source of generation and delivering it to our homes, offices, and factories. Sometimes referred to as “the world’s largest machine”, the grid is an important engineering marvel for the modern economy.
The above infographic from the National Public Utilities Council explains how the power grid works and highlights the three key components that make up the grid.
#1: Electricity Generation
The grid begins with power plants that generate electricity, typically owned and operated by public, private, or investor-owned utilities.
More than 11,000 power plants comprise the U.S. grid, generating over 4 trillion kilowatt-hours (kWh) of electricity annually. These are fueled by various energy sources:
| Energy Source | 2021 Electricity Generation (billion kWh) | % of Total |
|---|---|---|
| Natural Gas | 1,575 | 38% |
| Coal | 899 | 22% |
| Nuclear | 778 | 19% |
| Renewables | 826 | 20% |
| Other | 38 | 0.9% |
| Total | 4,116 | 100% |
Source: Energy Information Administration (EIA)
Natural gas and coal together accounted for 60% of annual electricity generation in 2021, followed by nuclear power. Wind was the largest renewable energy source, making up 10% of renewable electricity generation.
Each power generation technology has a different role to play in the larger power grid. For example, coal and nuclear power plants that cannot easily adjust their output are known as baseload power plants. Their output remains roughly the same throughout the day, and they are typically used to deliver the minimum amount of power needed to keep the grid running.
On the other hand, power generation from natural gas and intermittent renewable sources like wind and solar fluctuates throughout the day, typically peaking in the evenings when demand is at its highest. Natural gas plants are especially useful in meeting peaks in demand because their output can be adjusted relatively quickly.
#2: Transmission
After generation, electricity travels from power plants to centers of demand through a process known as transmission.
First, the electricity is sent from power plants to substations where step-up transformers convert it to extremely high voltages for transmission. High-voltage conversions help minimize how much electricity is lost as heat during transmission, which is roughly 5% in the United States. The higher the voltage, the less electricity is lost.
Transmission lines then carry this high-voltage electricity across long distances and are often interconnected across states. Line voltages can vary from 69,000 volts (69 kV) to 765kV, and transmission lines can be both overhead and underground.
Here’s a map of all high-voltage (345kV or greater) U.S. transmission lines:
Source: U.S. Energy Atlas
Upgrading and expanding transmission infrastructure is key to achieving a decarbonized power grid, especially as utilities build solar and wind capacity in the sunniest and windiest parts of the country.
#3: Distribution and Consumption
Distribution is the final stage of delivering electricity, making up the last major component of the grid.
Simply put, distribution begins when transmission ends. It is the process of transporting power from the transmission system to individual customers. First, step-down transformers convert the high-voltage power from transmission lines into lower voltages that are suitable for use.
These transformers are connected to distribution poles, which are typically made of wood and used to carry electricity within centers of demand. There are about 180 million distribution poles in the U.S., and it’s likely that you encounter one every day, especially if you live in a city.
Distribution lines and poles deliver electricity to end consumers including households, office buildings, factories, and electric vehicles. Here’s a look at U.S. electricity sales to each end-use sector in 2021:
| Sector | 2021 retail electricity sales (billion kWh) | % of Total |
|---|---|---|
| Residential 🏠 | 1,480 | 39% |
| Commercial 🏢 | 1,320 | 35% |
| Industrial 🏭 | 987 | 26% |
| Transportation 🚙 | 6 | 0.2% |
| Total | 3,793 | 100% |
Source: EIA
Heating and cooling are the largest residential electricity uses. In the commercial sector, refrigeration and computers and office equipment account for over a quarter of electricity use. The transportation sector is by far the smallest electricity consumer, but these figures may change as electric vehicle sales rise.
At all times, the amount of electricity sent through the grid must match demand from end-use sectors. This is because all grids operate at a particular frequency (60 hertz in the United States). Excess power supply or demand can destabilize this frequency, potentially damaging grid infrastructure and triggering blackouts.
Modernizing the Power Grid
Just like machines that get old and need greasing, the U.S. power grid is aging and it needs an upgrade, especially as the power sector works to achieve 100% clean electricity by 2035.
The demand for electricity could accelerate in a scenario with high electrification, which involves switching from fossil fuel-powered technologies to electrical ones. For instance, one form of electrification is switching from gas-powered cars to electric cars.
To meet the growing demand for electricity, especially from clean energy sources, the U.S. will need to expand its transmission capacity and invest in modernizing the grid. In fact, reaching 100% clean electricity by 2035 could require anywhere from $330 billion to $740 billion in additional power system expenditures, according to a study by NREL.
Ultimately, upgrading and decarbonizing the grid are both pivotal to the U.S.’ climate goals, and this requires action from all stakeholders, from electric utilities to the government and end consumers.
The National Public Utilities Council is a collaborative body of industry experts coming together to solve decarbonization challenges in the power sector and the proud sponsor of the Decarbonization Channel.
Emissions per Capita of the Top 30 U.S. Investor-Owned Utilities
Approximately 25% of all U.S. greenhouse gas emissions (GHG) come from electricity generation.
Subsequently, this means investor-owned utilities (IOUs) will have a crucial role to play around carbon reduction initiatives. This is particularly true for the top 30 IOUs, where almost 75% of utility customers get their electricity from.
This infographic from the National Public Utilities Council ranks the largest IOUs by emissions per capita. By accounting for the varying customer bases they serve, we get a more accurate look at their green energy practices. Here’s how they line up.
Per Capita Rankings
The emissions per capita rankings for the top 30 investor-owned utilities have large disparities from one another.
Totals range from a high of 25.8 tons of CO2 per customer annually to a low of 0.5 tons.
| Utility | Emissions Per Capita (CO2 tons per year) | Total Emissions (M) |
|---|---|---|
| TransAlta | 25.8 | 16.3 |
| Vistra | 22.4 | 97.0 |
| OGE Energy | 21.5 | 18.2 |
| AES Corporation | 19.8 | 49.9 |
| Southern Company | 18.0 | 77.8 |
| Evergy | 14.6 | 23.6 |
| Alliant Energy | 14.4 | 14.1 |
| DTE Energy | 14.2 | 29.0 |
| Berkshire Hathaway Energy | 14.0 | 57.2 |
| Entergy | 13.8 | 40.5 |
| WEC Energy | 13.5 | 22.2 |
| Ameren | 12.8 | 31.6 |
| Xcel Energy | 11.9 | 43.3 |
| Duke Energy | 11.1 | 88.9 |
| Dominion Energy | 11.0 | 37.8 |
| Emera | 11.0 | 16.6 |
| PPL Corporation | 10.7 | 29.6 |
| PNM Resources | 10.0 | 5.3 |
| American Electric Power | 9.2 | 50.9 |
| Consumers Energy | 8.7 | 16.1 |
| NRG Energy | 8.2 | 29.8 |
| Florida Power and Light | 8.0 | 41.0 |
| Portland General Electric | 7.6 | 6.9 |
| Fortis Inc. | 6.1 | 12.6 |
| Avangrid | 5.1 | 11.6 |
| PSEG | 3.9 | 9.0 |
| Exelon | 3.8 | 34.0 |
| Consolidated Edison | 1.6 | 6.3 |
| Pacific Gas and Electric | 0.5 | 2.6 |
| Next Era Energy Resources | 0 | 1.1 |
PNM Resources data is from 2019, all other data is as of 2020
Let’s start by looking at the higher scoring IOUs.
TransAlta
TransAlta emits 25.8 tons of CO2 emissions per customer, the largest of any utility on a per capita basis. Altogether, the company’s 630,000 customers emit 16.3 million metric tons. On a recent earnings call, its management discussed clear intent to phase out coal and grow their renewables mix by doubling their renewables fleet. And so far it appears they’ve been making good on their promise, having shut down the Canadian Highvale coal mine recently.
Vistra
Vistra had the highest total emissions at 97 million tons of CO2 per year and is almost exclusively a coal and gas generator. However, the company announced plans for 60% reductions in CO2 emissions by 2030 and is striving to be carbon neutral by 2050. As the highest total emitter, this transition would make a noticeable impact on total utility emissions if successful.
Currently, based on their 4.3 million customers, Vistra sees per capita emissions of 22.4 tons a year. The utility is a key electricity provider for Texas, ad here’s how their electricity mix compares to that of the state as a whole:
| Energy Source | Vistra | State of Texas |
|---|---|---|
| Gas | 63% | 52% |
| Coal | 29% | 15% |
| Nuclear | 6% | 9% |
| Renewables | 1% | 24% |
| Oil | 1% | 0% |
Despite their ambitious green energy pledges, for now only 1% of Vistra’s electricity comes from renewables compared to 24% for Texas, where wind energy is prospering.
Based on those scores, the average customer from some of the highest emitting utility groups emit about the same as a customer from each of the bottom seven, who clearly have greener energy practices. Let’s take a closer look at emissions for some of the bottom scoring entities.
Utilities With The Greenest Energy Practices
Groups with the lowest carbon emission scores are in many ways leaders on the path towards a greener future.
Exelon
Exelon emits only 3.8 tons of CO2 emissions per capita annually and is one of the top clean power generators across the Americas. In the last decade they’ve reduced their GHG emissions by 18 million metric tons, and have recently teamed up with the state of Illinois through the Clean Energy Jobs Act. Through this, Exelon will receive $700 million in subsidies as it phases out coal and gas plants to meet 2030 and 2045 targets.
Consolidated Edison
Consolidated Edison serves nearly 4 million customers with a large chunk coming from New York state. Altogether, they emit 1.6 tons of CO2 emissions per capita from their electricity generation.
The utility group is making notable strides towards a sustainable future by expanding its renewable projects and testing higher capacity limits. In addition, they are often praised for their financial management and carry the title of dividend aristocrat, having increased their dividend for 47 years and counting. In fact, this is the longest out of any utility company in the S&P 500.
A Sustainable Tomorrow
Altogether, utilities will have a pivotal role to play in decarbonization efforts. This is particularly true for the top 30 U.S. IOUs, who serve millions of Americans.
Ultimately, this means a unique moment for utilities is emerging. As the transition toward cleaner energy continues and various groups push to achieve their goals, all eyes will be on utilities to deliver.
The National Public Utilities Council is a collaborative body of industry experts coming together to solve decarbonization challenges in the power sector and the proud sponsor of the Decarbonization Channel.
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