The nation's rapid adoption of clean energy technologies, combined with sustained natural gas consumption, sagging oil prices and the widespread deployment of energy efficiency measures, helped U.S. consumers drive down energy costs to record lows in 2016.

Where energy spending occurred, it was concentrated in low- or zero-carbon forms of energy that should help the United States continue the transition to a sustainable energy future, according to a benchmarking report released this morning by the Business Council for Sustainable Energy and Bloomberg New Energy Finance.

The findings from the “2017 Sustainable Energy in America Factbook,” while encouraging to clean energy advocates, also provide a powerful counterweight to claims by some, including in the Trump administration, that U.S. energy costs are being driven higher by the wide-scale adoption of wind, solar and other forms of renewable energy.

To the contrary, the analysis finds that steeply falling costs for renewables and other clean energy technologies has made traditional electricity fuels — namely coal and oil — less competitive than ever before.

“The contributions of sustainable energy to the country's economic competitiveness are direct, dramatic and dynamic,” Lisa Jacobson, president of the Washington-based business council, said in announcing the release of the factbook, now in its fifth year.

“The trend lines are clear,” Jacobson added. “Energy efficiency, natural gas and renewable energy are benefiting American consumers, American businesses and American manufacturers. And that adds up to one conclusion: Clean energy wins for America.”

Overall, the analysis found that Americans spent less than 4 percent of average annual household income on energy in 2016, the lowest ever recorded, while retail electricity prices fell 2.2 percent in real terms from 2015. On average, consumers now pay 3.9 percent less per kilowatt-hour for electricity than they did a decade ago.

In addition to a record 22 gigawatts of new renewable energy capacity last year, consumers also benefited from the nation's continued transition to low-cost natural gas for power production, heating and industrial use. Data showed that gas prices set or approached record lows in 2016, including the lowest real-term prices for commercial consumers since 1977.

According to BNEF, which compiled the data from government and industry sources, the factbook proves that the United States “remains one of the most competitive places in the world for energy-intensive industries and manufacturing” thanks to low electricity and natural gas prices — beating out other major economies such as China, India, Mexico and Japan.

Spending on zero-carbon technologies in the United States fell modestly in 2016, from $63 billion to $59 billion, BNEF found. The falloff was attributed in part to falling costs for solar photovoltaic modules, as well as fewer companies seeking public-market financing. U.S. wind energy investment rose 11 percent, to $15.5 billion, while “energy smart technologies” such as smart grid and electric vehicles saw investment rise 5 percent to $10.6 billion.

The U.S. also continues to use energy more efficiently than many of its peer countries while emitting fewer greenhouse gases, proving that energy and environmental goals can be achieved during periods of economic growth, said Colleen Regan, head of North America power and environmental markets for 2016 at BNEF.

“In the face of all this change, Americans are enjoying lower energy bills, directing less of their household income to energy spending than at any other time on record,” BNEF added. At the same time, more major U.S. corporations are procuring low-cost renewable energy to power their offices and operations, while energy efficiency has become a core tenet of corporate sustainability actions.

Investments needed in grid, pipelines

But for all of the progress in growing the U.S. sustainable energy market, challenges remain.

According to the report, “key federal policies supportive of sustainable energy hit stumbling blocks in 2016,” including a federal stay of the Obama administration's Clean Power Plan targeting carbon dioxide emissions from the power sector.

The U.S. also continues to face infrastructure problems, including a lack of transmission lines to carry thousands of megawatts of new generation from wind and solar farms that are being built in almost every part of the country, but especially in the Midwest and the Intermountain West.

Infrastructure investment is also needed in the natural gas sector, as demand for gas from the nation's major shale-gas-producing regions has exceeded current pipeline capacity. The report notes that in Appalachia, a planned 70 percent boost in pipeline capacity is underway to help meet demand outside the region.

The report also noted that low oil prices have led to an increase in U.S. demand for large cars and trucks with poorer fuel economy. Yet even with lower gasoline prices, BNEF found that sales of EVs jumped 38 percent from 2015 levels, and that more EVs and plug-in hybrid models are available than ever before.

Reprinted from Climatewire with permission from E&E News. E&E provides daily coverage of essential energy and environmental news at www.eenews.net.