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We updated the way we calculate primary energy consumption of electricity generation from noncombustible renewable energy sources (solar, wind, hydroelectric, and geothermal).
Beginning with the September 2023 Monthly Energy Review (MER), we are calculating consumption of noncombustible renewable energy for electricity generation using the captured energy approach, which applies a constant conversion factor of 3,412 British thermal units per kilowatthour (Btu/kWh), the heat content of electricity. This is a change from our old methodology, called the fossil fuel equivalency approach.
The captured energy approach is more consistent with international energy statistics standards than fossil fuel equivalency.
British thermal unit is a common energy unit
We collect data on a diverse range of energy types, mostly in differing physical units (crude oil in barrels, natural gas in cubic feet, etc.). We convert these data to common energy units (Btu), which enables us to compare energy types.
To calculate Btu values for combustible energy sources, we apply an average conversion rate specific to each source. This conversion allows us to report the data that we collect in physical units in Btu.
Fossil fuel equivalency versus direct conversion
For renewable-sourced electricity generation, we used the fossil fuel equivalency approach to convert the data that we collected in kWh to Btu. For this method, we used the average annual heat rate in Btu/kWh of the nation’s fossil fuel-fired power plants (natural gas, coal, petroleum). The resulting Btu value is the equivalent amount of fossil fuels that would need to be consumed to produce the same amount of electricity from these noncombustible energy sources.
For the captured energy approach, instead of using the average annual heat rate of the nation’s fossil-fuel fired power plants, which can vary from year to year, we use the constant conversion factor of 3,412 Btu/kWh.
After implementing the 3412 conversion factor
Beginning with the September 2023 Monthly Energy Review (MER), our models of future energy consumption in the form of hydroelectric power, geothermal power, solar power, and wind power in Btu will use the updated methodology. The Short-Term Energy Outlook (STEO) and State Energy Data System (SEDS) will begin using the updated methodology in October 2023, followed by the International Energy Outlook (IEO).
Read the MER Appendix E.
For more information, please contact our energy team.
