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Decarbonization is shifting the generation mix as we accelerate to a lower-carbon future. Renewable energy resources and zero-carbon sources like nuclear are seeing widespread interest by large-scale generators and industrials. The path to decarbonization faces several challenges, including the intermittency of renewables, the need for energy storage of varying durations and scales and the costs associated with transitioning from fossil fuels.

The speed of the energy transition and net-zero goals have prompted an increasing number of asset owners to consider using hydrogen to reduce carbon emissions from their natural gas-fired plants. Some utilities are conducting demonstration projects to assess the viability of blending hydrogen at gas plants, while gas turbine OEMs believe their equipment could eventually be fueled by 100 percent hydrogen. Still, hydrogen supply and technical challenges such as plant modifications remain to getting there.

Hydrogen could help clean up the power industry and hard-to-decarbonize sectors. The federal government’s Regional Clean Hydrogen Hubs program has allocated billions aimed at scaling and reducing the cost of clean hydrogen and expanding regional distribution networks. Each regional hub would create the production, processing, delivery, storage and end-use of clean hydrogen.

Consensus is growing that advanced nuclear could play an important role in meeting net-zero goals. Companies are racing to deploy small modular reactors (SMRs) with the promise of lower costs and faster build times than large, conventional reactors. But despite the positive momentum for new nuclear reactors, their promise of offering simplicity and standardization has yet to be tested. Several actions will likely need to be considered across financing, supply chain and regulation for the industry to scale up significantly.

Long-term cost issues and climate mandates are driving decisions to replace coal-fired generation with natural gas. O&M and labor costs are substantially reduced with gas-fired power plants. However, fuel price volatility and long-term uncertainty over carbon regulation remain issues for gas-fired power plants.

Conventional and renewable plant owners and operators must strategically manage their assets using the latest processes and solutions, including leveraging data to maximize the productivity of a highly trained and adaptive workforce. A successful maintenance regimen ensures assets’ continuous operations, extends their lives and enables their performance and availability.

Control room digitalization and rapid advances in sensors, simulation tools and artificial intelligence are driving efficiency gains and enabling real-time data on plant health and performance. Advancements in robotics are helping with inspections and other difficult operations and maintenance tasks. Large increases of intermittent renewable sources on the grid also require greater real-time analysis to offset fluctuations and control load balance.

Carbon capture technology could be a viable option for some coal and gas-fired power plants to reduce their emissions. The federal government has been encouraging companies to build infrastructure for capturing, transporting and storing carbon, and a renewed tax credit from the Inflation Reduction Act (IRA) also incentivizes investment. But while industry groups say the technology is crucial to America's overall decarbonization efforts, opponents note that it's costly and far from scale.

It is expected that many more gigawatts of battery storage will be added to help decarbonize the grid over the coming years. Battery storage manufacturing capacity is expected to continue expanding as major companies have announced plans to more than double capacity, including new facilities in North America. Lithium-ion batteries are currently the dominant storage technology in the power sector, although the value chain does face some economic and ESG-related challenges.

Long-duration energy storage systems can store and discharge a significant amount of energy, from hours to days or even weeks. Different conventional and novel technologies are being explored and developed, including compressed air energy storage, flow batteries, pumped hydro and thermal energy storage. Long-duration energy storage is becoming increasingly important as more renewable energy sources are added to the grid.

Also known as combined heat and power (CHP), cogeneration involves the simultaneous production of electricity and heat from the same energy source. Cogeneration systems are designed to maximize efficiency by utilizing waste heat that would otherwise be discarded in conventional power generation. Usually located at or near the facilities they power, cogeneration applications provide electricity and process heat for industry, large employers, urban centers and more.

The growth of microgrids is driven by a range of factors, including an increasing demand for reliable and resilient power and the need to reduce carbon emissions. Utilities are deploying microgrids in the face of extreme weather events, while hospitals, municipalities, the military and others aim to provide energy security for mission critical services.