PNNL

Abstract

Long-term temperature change and variability are expected to have significant impacts on future electric capacity and investments. This study improves upon past studies by accounting for hourly and monthly dynamics of electricity use, long-term socioeconomic drivers, and interactions of the electric sector with rest of the economy for a comprehensive analysis of temperature change impacts on cooling and heating services and their corresponding impact on electric capacity and investments. Using the United States (U.S.) as an example, we show that under a business-as-usual scenario, mean temperature changes drive increases in annual electricity demands by 0.5-8% across states in 2100. More importantly, peak temperature changes drive increases in capital investments by 3-21% (1-67 billion USD). Moreover, temperature-induced capital investments are highly sensitive to both long-term socioeconomic assumptions and spatial heterogeneity of fuel prices and capital stock characteristics which underscores the importance of a comprehensive approach to inform long-term electric sector planning.