A Long-term Energy Outlook
Posted: February 17, 2013
The US Energy Information Administration (EIA) is the arm of the Department of Energy (DOE) that collects and analyzes statistical energy data and provides this information for sound policymaking, efficient markets, and general understanding of energy and its role in the world. An Annual Energy Outlook (AEO) report is issued that reviews factors, trends and outlooks that may shape the US energy markets through the next few decades. Major highlights of the report discuss the following trends based on current laws and regulations remaining generally unchanged throughout the projection period:
1. Crude oil production, particularly from tight oil plays, rises sharply over the next decade – with continuing improvement of crude oil technologies, domestic supplies are expected to increase before declining gradually about 2020 as the sweet spots are developed before moving to less productive or less profitable areas.
2. Natural gas production is expected to be higher than reported in last year’s Outlook, with natural gas being used more in the industrial and electric power sectors and in exportation – while natural gas will be used more in electricity generation, power plant consumption won’t increase as sharply due to new plants being more efficient.
3. Motor gasoline consumption is expected to be lower due to more stringent corporate average fuel economy standards, but diesel fuel consumption is moderated by increased use of natural gas in heavy-duty vehicles.
4. US exports of natural gas expected to be more than projected in last year’s Outlook – due to dry natural gas production increasing and outpacing domestic consumption.
5. Industrial production expands in response to the initial competitive advantage of low natural gas prices – strong shale gas production and lower natural gas prices lower costs of raw materials and energy for production through 2025.
6. Renewable fuel use grows at a much faster rate than fossil fuel use
7. With improved efficiency of energy use and the move toward lower-carbon fuels, CO2 emissions may be 5% below their 2005 level through the year 2040.
For a greater discussion of these items, the AEO2013 Early Release Overview can be found on the EIA website at http://www.eia.gov/forecasts/aeo/er/ until the full report is released in the spring.