Washington (Platts)--22May2008

US consumption of renewable energy fell 1% in 2007 to 6,830 trillion Btu
from 2006, largely because of a sharp drop in hydro-electric generation last
year, the US Energy Information Administration said.

In releasing preliminary numbers on Wednesday, the agency said the
decline in renewable consumption came as both total and non-renewable energy
consumption increased by 2%.

EIA said hydro-electric fell 14% in 2007, from 2.869 quadrillion Btu in
2006 to 2.463 quads last year, because of decreased precipitation in several
regions of the country.

Consumption of all other renewable resources increased in 2007. The
largest gainers were biomass, which rose 7% to 2.615 quads last year from
3.374 quads in 2006, and wind, which jumped 14% to 0.319 quads from 0.264
quads in 2006, the agency said.

Major increases in consumption of biomass to produce and use biofuels
(ethanol and biodiesel) were almost entirely responsible for the increase in
biomass in 2007, EIA said.

The report said that just over half of renewable energy consumption in
2007 occurred in the electric power sector, followed by the industrial sector,
which accounted for nearly 30% of total consumption. The transportation,
residential and commercial sectors accounted for 9%, 8% and 2%, respectively,
EIA added.

Further, the report said that while the electric power sector currently
consumes the most renewable energy, some 51%, its use dropped 8% in 2007 from
the previous year. In 2003, EIA said, the electricity sector account for 59%
of total renewable energy consumption.

In contrast, EIA said renewable energy consumption by the transportation
sector rose 30% in 2007 and residential sector consumption grew 12%.

Commercial and industrial uses of renewable energy changed little between
2006 and 2007 and have also changed little as a fraction of total renewable
consumption since 2003, the agency said. EIA, however, said that could change
for the industrial sector if ethanol and biodiesel use continues to grow
rapidly resulting in increased feedstock consumption.

Within the electric power sector, EIA said wind-energy consumption has
grown each year since 1998. From 2003 to 2007, wind's share of total renewable
energy consumption increased from 2% to 5% and in 2007 for the first time
ever, wind energy consumption in the electric power sector exceeded
geothermal.

Hydro-electricity accounted for 36% of total renewable consumption in
2007, EIA said, down from 46% in 2003. However, hydro consumption is tied
mostly to precipitation, which can vary year to year, given that few plants
are being built or retired.

Electricity generation from renewable sources fell 9% in 2007 to 351
billion kWh, largely because of reduced precipitation. Excluding hydro
electricity, however, EIA said renewable electricity generation grew 7%. This
gain was led by a 21% increase in electricity from wind and moderate increases
in electricity from biomass waste, the agency added.

Total renewable electricity capacity rose 5 percent to 107,000 MW, led by
a 38%, or 4,000-MW increase, in wind capacity. Total non-renewable electric
capacity rose just 1% to 892,000 MW in 2007, EIA added.