EIA says oil imports to drop, renewables to increase
By Sara Wyant
© Copyright Agri-Pulse Communications, Inc.
WASHINGTON, January 25, 2012 -The Annual Energy Outlook 2012 “early release” issued by the DOE's Energy Information Administration (EIA) this week projects an increase in the share of U.S. electric power generation from natural gas and renewables, growth in domestic crude oil and natural gas production and a reduction in the nation's reliance on oil imports through 2035.< div style="text-align: center;">
The preliminary report - the full report will be issued in late April ‑ highlights a scenario that assumes no changes in current laws and regulations.
It also projects U.S. natural gas production exceeding consumption, and energy-related carbon dioxide emissions remaining below their 2005 level through 2035.
“These projections reflect increased energy efficiency throughout the economy, updated assessments of energy technologies and domestic energy resources, the influence of evolving consumer preferences, and projected slow economic growth,” said EIA Acting Administrator Howard Gruenspecht.
The EIA says the outlook serves “as a starting point for analysis of potential policy changes or technology breakthroughs.” Among the key findings of the outlook is that the natural gas share of electric power generation increases from 24% in 2010 to 27% in 2035, and the renewables share grows from 10% to 16% over the same period.
The report shows domestic crude oil production grew from 5.1 million barrels per day in 2007 to 5.5 million barrels per day in 2010. Over the next 10 years, continued development of tight oil supplies combined with the development of offshore Gulf of Mexico resources are projected to push domestic oil production to 6.7 million barrels per day in 2020, a level last seen in 1994.
The EIA says that with modest economic growth, increased efficiency, growing domestic production, and continued adoption of nonpetroleum liquids, net petroleum imports make up a smaller share of total liquids consumption. U.S. dependence on imported petroleum liquids declines, primarily as a result of growth in domestic oil production of more than 1 million barrels per day by 2020, an increase in biofuel use of more than 1 million barrels per day crude oil equivalent by 2024, and modest growth in transportation sector demand through 2035, according to the EIA outlook. Under the scenario laid out by the EIA report, net petroleum imports as a share of total U.S. liquid fuels consumed drop from 49% in 2010 to 36% in 2035.
In recent years, the U.S. electric power sector's historical reliance on coal-fired power plants has begun to decline, the EIA says. Over the next 25 years, the projected coal share of overall electricity generation falls to 39 percent, well below the 49-percent share seen as recently as 2007, because of slow growth in electricity demand, continued competition from natural gas and renewable plants, and the need to comply with new environmental regulations.
Other findings show that as pressure from growth in global demand continues, the average real price of crude oil rises in 2035 to $146 per barrel in 2010 dollars, driven by world liquids consumption growing from 87.1 million barrels per day in 2010 to 109.7 million barrels per day in 2035. The rise in demand will come from China, India, the Middle East and other developing economies, the EIA says.
Meanwhile, U.S. primary energy consumption grows from 98.2 quadrillion Btu in 2010 to 108.0 quadrillion Btu in 2035. However, the fossil fuel share of energy consumption falls from 83 percent of total U.S. energy demand in 2010 to 77 percent in 2035.
Because of the rise in projected domestic energy production, the net imports of energy meet a declining share of total U.S. energy demand. The projected net import share of total U.S. energy consumption in 2035 is 13%, compared with 22% in 2010 and 29% in 2007, the EIA says.
Original story printed in January 25, 2012 Agri-Pulse Newsletter.
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