Annual Energy Outlook 2013 Early Release …...Source: EIA, Annual Energy Outlook 2013 Early Release...

www.eia.gov U.S. Energy Information Administration Independent Statistics & Analysis

Annual Energy Outlook 2013 Early Release Reference Case

AEO2013 Early Release Rollout Presentation Paul H. Nitze School of Advanced International Studies Johns Hopkins University December 5, 2012 | Washington, D.C. by Adam Sieminski, Administrator

Key results from the AEO2013 Reference case:

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• Growth in energy production outstrips consumption growth • Crude oil production, particularly from tight oil plays, rises sharply over

the next decade • Natural gas production is higher throughout the Reference case

projection than it was in AEO2012, serving the industrial and power sectors and an expanding export market

• Motor gasoline consumption reflects the introduction of more stringent fuel economy standards, while diesel fuel consumption is moderated by increased natural gas use in heavy-duty vehicles

• The U.S. becomes a larger exporter of natural gas and coal than was projected in the AEO2012 Reference case

• All renewable fuels grow, but biomass and biofuels growth is slower than in AEO2012

• U.S. energy-related carbon dioxide emissions remain more than five percent below their 2005 level through 2040, reflecting increased efficiency and the shift to a less carbon-intensive fuel mix

Adam Sieminski AEO2013, December 5, 2012

What is included (and excluded) in developing EIA’s “Reference case” projections?

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• Generally assumes current laws and regulations – excludes potential future laws and regulations (e.g., proposed greenhouse gas legislation is

not included)

– Sunset provisions as specified in law (e.g., renewable production tax credits expire at the end of 2012)

• Some grey regulatory areas – adds a premium to the cost of financing CO2-intensive technologies to reflect current

market behavior regarding possible future policies to mitigate greenhouse gas emissions

– assumes implementation of existing regulations that enable the building of new energy infrastructure and resource extraction

• Includes technologies that are commercial or reasonably expected to become commercial over next decade or so

– includes projected technology cost and efficiency improvements, as well as cost reductions linked to cumulative deployment levels

– does not assume revolutionary or breakthrough technologies


Growth in energy production outstrips growth in consumption leading to reduction in net imports

4

U.S. energy production and consumption quadrillion Btu

Source: EIA, Annual Energy Outlook 2013 Early Release

Consumption

Production

Net imports

9%

19% 10%

History Projections 2011 2035


Domestic production grows rapidly over projection period, particularly natural gas and renewables, and liquids in the near term

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U.S. energy production quadrillion Btu


History Projections 2011

28%

19%

30%

12%

11%

24%

35%

17%

14%

10%

Shares of total U.S. production

Nuclear

Crude oil and natural gas plant liquids

Natural gas

Coal

Renewables


U.S. energy use grows slowly over the projection reflecting improving energy efficiency and a slow and extended economic recovery

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U.S. primary energy consumption quadrillion Btu



36%

20%

26%

8% 8%

1%

32%

28%

19%

11%

9% 2%

Shares of total U.S. energy

Nuclear

Oil and other liquids

Liquid biofuels

Natural gas

Coal

Renewables (excluding liquid biofuels)

2000

23%

39%

24%

6% 8%


U.S. energy use is slowed by rising energy prices and the adoption of new efficiency standards for vehicles

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U.S. primary energy consumption quadrillion Btu



28%

15%

11%

14% 4%

25%

23%

16%

15%

4%

Shares of total U.S. energy

Transportation

Industrial

Residential

Commercial Commercial: electricity

Residential: electricity

Industrial: electricity 11%

5% 7%

21%


Energy and CO2 per dollar of GDP continue to decline; per-capita energy use also declines

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Energy and emission intensity index, 2005=1



Carbon dioxide emissions per 2005 dollar of GDP

Energy use per 2005 dollar of GDP

Energy use per capita

2005


In the AEO2013 Reference case, energy-related CO2 emissions never get back to their 2005 level

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Carbon dioxide emissions billion metric tons


Projections History 2011 2005

2005 2020 2040 (billion metric tons)

6.00 5.45 5.69

- - -9.0% -5.1%

(percent change from 2005)

AEO2013


Petroleum and other liquid supply

10 Adam Sieminski AEO2013, December 5, 2012

Reference case oil price initially drops and then rises steadily, but there is uncertainty about the future trajectory

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Annual average spot price of Brent crude oil 2011 dollars per barrel


Projections History 2011

High Oil Price

Low Oil Price

Reference


Global liquids supply increases 26 percent with regional market shares relatively stable

12

Global liquids supply million barrels per day



OPEC

Other non-OECD

OECD

44%

25%

31%

40%

26%

34%


U.S. dependence on imported liquids declines

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U.S. liquid fuel supply million barrels per day


Consumption

Domestic supply

Net imports 45%

37%


60%

2005 2035

37%


U.S. import share of liquid fuels declines due to increased production of tight oil and gas liquids, and greater fuel efficiency

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U.S. liquid fuels supply million barrels per day


Projections History

Natural gas plant liquids

Petroleum production

Biofuels excluding imports

Net petroleum and biofuel imports

17%

7%

37%

38%

5%

45%

38%

12%

Liquids from natural gas and coal 1%

2011


U.S. tight oil production leads a growth in domestic production of 2.6 million barrels per day between 2008 and 2019

15

U.S. crude oil production million barrels per day


Tight oil

Alaska

Other lower 48 onshore

Lower 48 offshore



Light-duty vehicle liquids consumption is lower primarily due to more stringent CAFE standards

16

Light-duty vehicle liquids consumption million barrels per day


AEO2012

AEO2013


Transportation sector motor gasoline demand declines

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Transportation energy consumption by fuel quadrillion Btu


60% Motor gasoline

E85 Jet fuel

CNG/LNG 11%

13% 4%

29%

47%


2%

Pipeline fuel 3%

4%

Other 4%

Diesel 22%

1%


Biofuels grow at a slower rate due to lower crude oil prices and slower growth in E85 sales

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Renewable fuel standard credits billions ethanol-equivalent gallons

Sources: EIA, Annual Energy Outlook 2013 Early Release and EIA, Annual Energy Outlook 2012

Other Advanced

Legislated RFS in 2022 Biodiesel Net imports

Cellulosic biofuels

Corn ethanol

RFS with adjustments under CAA Sec.211(o)(7)

2011 2022 2035 2040


Natural gas


Coal regains some competitive advantage relative to natural gas over time on a national average basis

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ratio of natural gas price to steam coal price


History Projections

2011 2011 dollars per Btu


Competitive parity

Energy prices to the electric power sector

Coal

Natural gas


Domestic natural gas production grows faster than consumption and the U.S. becomes a net exporter of natural gas around 2020

21

U.S. dry gas trillion cubic feet



Consumption

Domestic supply

Net imports


Shale gas production leads growth in production through 2040

22

U.S. dry natural gas production trillion cubic feet


Associated with oil Coalbed methane

Tight gas

Shale gas

Alaska

Non-associated onshore

Non-associated offshore



Total natural gas exports nearly quadruple by 2040 in the AEO2013 Reference case

23

U.S. natural gas exports trillion cubic feet


Alaska LNG exports

Exports to Mexico

Exports to Canada

Lower 48 LNG exports


24

U.S. dry gas consumption trillion cubic feet


Projections History

Industrial*

Electric power

Commercial

Residential

Transportation**

33%

14%

6%

32%

12%

33%

19%

3%

31%

13%

*Includes combined heat-and-power and lease and plant fuel. **Includes pipeline fuel.

Gas to liquids 2%

Natural gas consumption is quite dispersed with electric power, industrial, and transportation use driving future demand growth


Industrial natural gas usage grows, especially before 2025

25

Industrial natural gas consumption quadrillion Btu



Electricity


Growth in electricity use slows, but still increases by 28% from 2012 to 2040

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U.S. electricity use percent growth (3-year rolling average)


Projections

History 2011

Period Annual Growth 1950s 9.8 1960s 7.3 1970s 4.7 1980s 2.9 1990s 2.4 2000-2011 0.9 2012-2040 0.9


Over time the electricity mix gradually shifts to lower-carbon options, led by growth in natural gas and renewable generation

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U.S. electricity net generation trillion kilowatthours


25%

19%

42%

13%

1%

Nuclear

Oil and other liquids

Natural gas

Coal

Renewables

2011 Projections History

17%

16%

35%

30%

1%

1993

53%

13%

19% 11%

4%


Non-hydro renewable generation more than doubles between 2011 and 2040

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Non-hydropower renewable generation billion kilowatthours per year


Wind

Solar

Geothermal Waste

Biomass

Industrial CHP

Power sector

Advanced biofuels cogeneration (not visible)

2011 Projections History


For more information

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U.S. Energy Information Administration home page | www.eia.gov

Annual Energy Outlook | www.eia.gov/forecasts/aeo

Short-Term Energy Outlook | www.eia.gov/forecasts/steo

International Energy Outlook | www.eia.gov/forecasts/ieo

Today In Energy | www.eia.gov/todayinenergy

Monthly Energy Review | www.eia.gov/totalenergy/data/monthly

Annual Energy Review | www.eia.gov/totalenergy/data/annual


http://www.eia.gov/

http://www.eia.gov/forecasts/aeo

http://www.eia.gov/forecasts/steo

http://www.eia.gov/forecasts/ieo

http://www.eia.gov/todayinenergy

http://www.eia.gov/totalenergy/data/monthly

http://www.eia.gov/totalenergy/data/annual

Annual Energy Outlook 2013 Early Release …...Source: EIA, Annual Energy Outlook 2013 Early Release...

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