Renewables to increase growth curve in U.S. market next year

WASHINGTON, DC, US, February 22, 2006 (Refocus Weekly)

The growth in demand for renewable energy in the United States will be more than double next year, than it will be this year.

All renewables will grow 3.9% from 2006 to 2007, according to the Energy Information Administration in its latest ‘Short-Term Energy Outlook.’ From 2005 to 2006, growth will be 1.5% compared with 0.5% from 2004 to 2005.

Total demand for renewables under the base case will be 6.256 quadrillion Btu this year, up from 6.163 quads last year and 6.134 quads in 2004. By 2007, demand will be 6.498 quads.

In the U.S. electricity sector, growth will be led by wind, solar and geothermal, with the 2006-2007 increase expected to be 11.% compared with 1.3% this year and 0.9% last year. Demand will be 0.470 quads this year, compared with 0.464 quads last year, and will be 0.524 quads in 2007.

Demand for power from biofuels, which includes wood, byproducts, municipal solid waste and alcohol fuels, will be 0.520 quads this year, a decline of 0.8% from last year. It will grow 2.9% into 2007, to reach 0.535 quads.

Hydroelectricity remains the largest component of green power demand in the U.S., expected to be 2.859 quads this year and rise 4.1% to 2.976 quads in 2007. This follows increases of 6.6% and 0.1% in the past two years for conventional hydro only; electricity generated by pumped storage is not included in DOE’s definition of renewable energy.

In total, demand for green power will grow by 4.9% this year and the same level into 2007, rising from 3.848 quads in 2006 to 4.035 quads.

In the residential and commercial sector of the U.S., demand for renewables will decline 0.8% this year, to 0.523 quads from 0.527 quads in 2005. Going into next year, it will increase by 1.7% to 0.532 quads.

DOE notes that renewables in the non-power sector includes minor components of non-marketed renewables that is neither bought nor sold, either directly or indirectly as inputs to marketed energy, and includes all off-grid and non-measured energy from solar collectors and heat pumps. EIA does not estimate consumption of non-marketed renewables.

The commercial sector is stronger, although not as large. At 0.108 quads of demand this year, it will rise 1.9% into 2007. In the residential sector, the 0.415 quads of renewables this year is down 1.4% from 2005, and will grow 1.7% into next year.

The industrial sector continues to decline, with the 1.508 quads this year down 7.7% from 2005 and 2.6% from 2004, and will drop 0.3% going into 2007. Transportation demand for renewables has increased by 13.2% and 12.5% during the past two years, and the current demand of 0.377 quads will grow by 13.5% next year.

In the non-power sector, total demand for renewables will experience a decline of 3.4% this year compared with 2005, but the expected 2.408 quads in 2006 will increase by 2.3% going into 2007, the report explains.

During 2006 and 2007, total domestic energy demand will increase at an average annual rate of 1.4% each year, the report explains. Despite winter temperatures that are 27% warmer in the U.S. than normal, cold weather in Asia and Europe, combined with uncertainties regarding oil supplies from Nigeria, Iran and Iraq, are keeping the price for crude oil high.

Electricity demand will increase by 0.5% this year and another 2.0% in 2007 due to weather conditions and continuing economic growth, and residential electricity prices range from 7.9c to 13.9c/kWh across the country.


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