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U.S. Report Examines Shift to Renewable Fuels

December 22, 2009

WASHINGTON, D.C. --- A new report from the U.S. federal government projects that national energy consumption will grow by 14 percent between 2008 and 2035, as the fossil fuel share of total U.S. energy use falls from 84 percent to 78 percent. 

The Annual Energy Outlook 2010, released by the U.S. Energy Information Administration (EIA), presents updated projections for U.S. energy consumption and production through 2035. 

"Our projections show that existing policies that stress energy efficiency and alternative fuels, together with higher energy prices, curb energy consumption growth and shift the energy mix toward renewable fuels," said EIA Administrator Richard Newell. However, assuming no new policies, fossil fuels would still provide about 78 percent of all the energy used in 2035." 

These reference case projections do not include the effects of potential future policies that have not yet become law, and only include technologies that are commercially available or can reasonably be expected to become commercially available over roughly the next decade. 

Some of the report's key findings are: 

  • Moderate energy consumption growth and greater use of renewables -- Total primary energy consumption grows by 14 percent between 2008 and 2035, as the fossil fuel share of total U.S. energy consumption falls from 84 percent to 78 percent. 
  • Declining reliance on imported liquid fuels -- Total U.S. consumption of liquid fuels, including both fossil liquids and biofuels, grows from 19 million barrels per day in 2008 to 22 million barrels per day in 2035. Biofuels account for all of the growth, as consumption of petroleum-based liquids is essentially flat. As a result, reliance on imported oil declines significantly over the next 25 years.
  • Shale gas drives growth in natural gas production and reduces reliance on imported gas -- Total domestic natural gas production grows from 20.6 trillion cubic feet in 2008 to 23.3 trillion cubic feet in 2035. With technology improvements and rising natural gas prices, natural gas production from shale grows to 6 trillion cubic feet in 2035, more than offsetting declines in conventional production.
  • Energy-related carbon dioxide (CO2) emissions continue to grow, assuming no new policies -- CO2 emissions from energy grow at 0.3 percent per year, assuming no new policies to reduce energy-related CO2 emissions. Total energy-related CO2 emissions grow from 5,814 million metric tons in 2008 to 6,320 million metric tons in 2035, although per capita emissions fall by 0.6 percent per year. Most of the CO2 growth in the AEO2010 reference case is accounted for by the electric power and transportation sectors. 

The report projects that the U.S. will fall short of the 36 billion gallon renewable fuels standard target in 2022. But the renewable fuels standard targets are expected to be exceeded by 2035. Here are the projections for the consumption of biofuels in 2022:

  • Corn-based -- 15 billion gallons
  • Cellulose-based -- 4.92 billion gallons
  • Other feedstock -- 0.72 billion gallons
  • Imports -- 1.04 billion gallons
  • Biodiesel -- 2.81 billion gallons
  • Liquids from biomass -- 2.94 billion gallons
  • Green liquids -- 0.73 billion gallons

Other highlights of the reference case projections:

  • U.S. crude oil production increases from 5 million barrels per day in 2008 to over 6 million barrels per day in 2027 and remains at just over 6 million barrels per day through 2035. Growth in crude oil production results from increases in offshore production and in onshore production using enhanced oil recovery techniques.
  • Total electricity consumption, including both purchases from electric power producers and on-site generation, grows by 1 percent per year over the projection period, from 3,873 billion kilowatt hours in 2008 to 5,021 billion kilowatt hours in 2035.
  • Natural gas and renewable power plants account for the majority of electricity generating capacity additions. The natural gas share falls slightly due to the completion of coal plants under construction, and the addition of new renewable capacity. However, by 2035 the share of generation from natural gas again increases to 21 percent. Renewable generation shows the strongest growth between now and 2035, spurred by incentive programs in more than half the states. The renewable share of generation grows from 9 percent of generation in 2008 to 17 percent of generation in 2035.  
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