U.S. utilities worsen on climate goals compared to five years ago
A recent report reveals that American utilities are falling further behind on decarbonization efforts than they were in 2019. Despite commitments to net-zero emissions by 2050, the sector added minimal renewable capacity last year and plans to expand fossil fuel infrastructure. This slowdown raises concerns about meeting climate targets.
The analysis comes from Energy Innovation, a nonprofit research group focused on clean energy policy. Their report, released in late 2024, examines the 100 largest U.S. utilities, which serve about 80% of electricity customers. It finds that progress toward reducing carbon emissions has stalled and even reversed in some areas.
Five years ago, in 2019, utilities were adding renewables at a brisk pace: wind and solar accounted for 14% of new generating capacity. By contrast, in 2023, that figure dropped sharply to just 2%. This decline reflects broader challenges in the sector, including supply chain issues, permitting delays, and a surge in electricity demand from data centers and electrification.
Emissions from the U.S. power sector, which had been falling for several years, rose by 1% in 2023—the first increase since 2019. The report attributes this partly to increased reliance on natural gas. Looking ahead, utilities have proposed adding 96 gigawatts (GW) of gas-fired capacity between 2024 and 2028, compared to only 60 GW of new wind and solar.
"The pace of decarbonization has slowed dramatically," said Mike O'Boyle, a senior energy policy analyst at Energy Innovation. He noted that while some utilities have made bold pledges, execution lags far behind. Only 13 of the 100 largest utilities have what the report calls "credible" plans to fully decarbonize their operations by 2035, aligning with aggressive climate scenarios.
The findings underscore tensions in the energy transition. Utilities face pressure from regulators, investors, and customers to cut emissions, yet economic incentives for gas plants persist amid rising demand. For instance, the boom in artificial intelligence has prompted projections of electricity needs doubling by 2030, potentially locking in more fossil fuels if renewables can't scale fast enough.
Energy Innovation urges policymakers to streamline approvals for clean energy projects and enforce stricter emissions standards. Without such measures, the report warns, the U.S. risks missing Paris Agreement goals and exacerbating climate impacts like extreme weather.