EIA Examines the Impacts of Alternate Future Scenarios
on Energy Trends
EERE Network News - May 12, 2010
How will various scenarios for future economic growth and energy
policies affect the projected U.S. energy use in 2035? That's a question
that DOE's Energy Information Administration (EIA) attempts to tackle in
its May 11 release of the full Annual Energy Outlook 2010. In December
2009, the EIA released its reference case projections for 2035,
sometimes referred to as the "business-as-usual" case, but the new
release includes 38 alternative cases that examine the sensitivity of
those projections to various assumptions about future economic growth,
oil prices, and policies. For instance, the reference case has U.S.
energy use growing at 0.5% per year, but a slow-growing economy could
hold that growth to only 0.1% per year, while an overheated economy
could increase that to 0.9% per year.
The EIA reference scenario also assumes that various tax credits will
expire without being renewed and that there are no new policies, such as
updated efficiency standards and fuel economy standards. In contrast,
the "No Sunset" case continues current tax credits for renewable power,
building efficiency, industrial combined heat and power, and biofuels,
and it anticipates further increases in the Renewable Fuel Standard (RFS)
after 2022. In this scenario, the growth in energy use is nearly the
same as in the reference case, but the shift to cleaner energy sources
cuts energy-related carbon dioxide emissions by 2.3%. The "Extended
Policies" case adds in updated appliance efficiency standards and newly
proposed fuel economy standards, but drops biofuels tax credits,
assuming the RFS is sufficient to stimulate biofuels demand. That case
drops U.S. energy use in 2035 by 3%, while also cutting energy-related
carbon dioxide emissions by 3.2%. And what if homeowners adopted the
most energy-efficient technologies, regardless of cost? That would cut
residential energy use by 27% in 2035, demonstrating a clear benefit to
overcoming the barriers to greater energy efficiency.
Another major factor in near-term future U.S. energy use is the
production of natural gas from shale and tight sands. These relatively
new "unconventional" sources of natural gas are currently projected to
cause domestic natural gas production to increase significantly, keeping
imports of liquefied natural gas at low levels. Examining the case in
which such unconventional drilling is halted, natural gas prices
increase to $10.88 per million Btu in 2035, and U.S. natural gas
production falls to 17.4 trillion cubic feet. On the other hand, if
current drilling continues and new, unproven resources hit pay dirt,
U.S. production grows to 25.9 trillion cubic feet in 2035, while natural
gas prices drop to $7.62 per million Btu. See the EIA press release:
http://www.eia.doe.gov/neic/press/press340.html
The full report:
http://www.eia.gov/oiaf/aeo/index.html
and a December 2009 article on the reference case from the EERE
Network News:
http://apps1.eere.energy.gov/news/news_detail.cfm/news_id=15687
The EERE Network News is funded by DOE's Office of Energy Efficiency
and Renewable Energy (EERE) and is also available on the EERE Web site
at http://www.eere.energy.gov .
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