The Renewable Energy Reality Check

[Benton D Struckcheon]

30. Neither agree nor disagree

I don't know about the precise figure. I would say that, being a gov org, the EIA is going to be conservative. What they aren't going to take account of is not just increases in technological efficiency - I'm sure they have that factored in - but the market impact of the combination of increased efficiency + the downward pressure on fossil fuel prices.
That latter is the key.
The simple fact is, wind has already displaced oil. It will begin to displace the other fossil fuels starting now. No one is getting that.
This is what will happen: any mineral extraction, whether it be from mining or drilling, is undertaken because it is above breakeven by enough to make it worthwhile. If the price declines by enough, breakeven points disappear and mining/drilling stop. Then you get a weird effect: the price rises as supply disappears faster than demand. While this will stimulate more mining/drilling after a while that will then lower the price again, it will also make utilities think twice about using something where the price jumps around too much. Fossil fuel prices are already notoriously jumpy, and that's only going to get worse as pressure is exerted from renewables. That's what no one seems to get.
No businessman likes that kind of uncertainty, especially given that utilities are always running with high debt levels because of the capital intensity of the business. Meantime, continued efficiency improvements and wider adoption leading to lowered per-unit costs will continue to exert relentless downward pressure on the price of generation by wind, and possibly solar. Wind is going to be "dispatchable", too much is at stake for that not to happen, and all of the technology you need to make it so is already in existence, and large companies with very deep pockets like GE are working hard on it. Given this, it's pretty easy to project a "tipping point", where the only rational decision for a utility when looking to put in new capacity is to put in a relatively reliable - from a cost standpoint - renewable installation backed by a fossil fuel plant who's generation cost will be far more variable as it will depend on where in the cycle the price of that fossil fuel is. If wind turbines are already storing their output, then these plants will only be used in periods of high demand: heat waves or cold snaps.
Projections are linear. Markets aren't.