Renew Economy:

The head of NextEra Energy, the biggest and most successful utility in the United States says the energy industry is in the grip of massive change, with the cost of renewables and battery storage – without subsidies – beating gas, as well as existing coal and nuclear on costs.

“We see renewables plus battery storage without incentives being cheaper than natural gas, and cheaper than existing coal and existing nuclear,” Jim Robo, the CEO, president and chairman of NextEra, told analysts last week at the Wolfe Utilities & Energy Conference. “And that is game changing,” Robo said. So much so, that renewables would likely replace coal generation in the US within a decade.

Robo noted that the US government’s Energy Information Administration expects that the world’s biggest electricity market could reach 35 per cent renewables by 2030. Robo says it could be as high as 50 per cent by 2030, and could ultimately be 70-75 per cent by 2050.

“I think that’s very doable, and that would take out an enormous amount of carbon out of the United States. And at the same time bring rates down across the country. And that’s the thing that I think people still haven’t grasped – that you can be green and low cost at the same time and that it’s terrific for customers, it’s terrific for the environment and it’s great for shareholders as well.”

Robo’s comments are significant for a number of obvious reasons. Close watchers of the US energy market will already be aware that the cost of wind and solar has fallen dramatically, and recent auctions for “dispatchable” energy has seen renewables and battery storage projects beating out gas, which is significantly cheaper in the US than in Australia. And the fact that renewables and storage, without further incentives, can beat out existing coal and nuclear plants, most of which have been fully depreciated, is just as significant. As is Robo’s point that “you can be green and low cost” at the same time. And, as he also notes, can deliver reliable power as well.

“When you look at wind and solar paired with a battery, new construction is cheaper than the operating cost of existing coal. So, there’s very little reason from an economic standpoint to continue to run those units and there’s very little reason from a reliability standpoint to run those units and there’s certainly no reason from an environmental standpoint to run them. So, we see a massive shift there in terms of much of the coal in the country being phased out by 2030.”

More: U.S. energy giant says renewables and batteries beat coal, gas and nukes