IEA urges US to improve energy-electricity strategy

The International Energy Agency (IEA) on Thursday urged the United States to improve its energy policy and adopt a more "stable and co-ordinated approach" than has been practiced in the past.
Publishing a review of the US energy sector, the Paris-based IEA called on the US to increase investment in the electricity sector and maximise its potential.
"The United States is in a strong position to deliver a reliable, affordable and environmentally sustainable energy system," the IEA said.
"To do so, however, the country must establish a more stable and co-ordinated strategic approach for the energy sector than has been the case in the past," the review noted.
US policy in several areas was praised, including the four-year annual policy review and the Climate Action Plan to explore renewable and non-fossil fuel sources, but it was indicated that more should be done in a number of areas.
Energy policies in the US have bolstered security, sustainability and competitiveness but "challenges remain," the IEA said.
Among recommendations to tackle these remaining challenges, the US should develop clear policies for electricity generation.
"This means predictable, effective national policies to encourage investment, greater coordination to encourage the integration of renewables, and a common understanding on the future of nuclear power", the review remarked.
Despite a dramatic increase in gas supplies because of fracking, which has led to stable wholesale electricity prices, lower greenhouse emissions and greater system flexibility, "the entire (power) system is in need of significant investment if the United States is to meet its electricity demand growth forecasts" and improve the ability to fight climate change. In addition, the IEA warned that "competitive electricity markets may not trigger investments in large, high-fixed-cost investments" which need long-term commitment such as in the nuclear and large renewable or environmentally-friendlier sectors.
"Effective and Co-ordinated policies" on a national scale would help stabilise the energy environment and lift uncertainties that are discouraging investment in electricity supplies, it was also indicated.
The IEA also urged scrutiny of "unconventional gas production", or fracking which is sharply increasing US production at this time and it "emphasised that this expansion in energy production is also raising unease on environmental and safety grounds, concerns which must be addressed appropriately".