U.S. CO2 Emissions to Rise 8.7% by 2035 Unless Government Acts

EIA Projections Show Oil Flattens Out; Biofuels Get a Bump

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If the U.S. government changes nothing about its approach toward energy and global warming, the nation’s energy consumption will grow 14 percent by 2035. Fossil fuels will retain a relatively high share of that total, and U.S. carbon dioxide emissions from energy will increase by 8.7 percent.

Those are the latest long-term projections described by the Department of Energy’s Energy Information Agency on Monday.

The findings highlight a need for federal regulations if greenhouse gas emissions are to be reduced as Congress is considering and members of the international community are demanding in Copenhagen this week. The findings also suggest that state efforts to increase energy efficiency and renewable energy use will begin to pay off.

The EIA’s Annual Energy Outlook 2010 projects the landscape of U.S. energy consumption and production from 2008 through 2035. Its reference case, released on Monday, assumes no new policies that would cap or otherwise regulate the production of greenhouse gas-producing energy and "only include technologies that are commercially available or can reasonably be expected to become commercially available over roughly the next decade."

Within this model, domestic natural gas production increases 2.3 percent in 2035, with natural gas production from shale deposits growing to 6 trillion cubic feet due to expected technology improvements. This offsets predicted declines in more conventional sources of natural gas production.

A similar phenomenon occurs in liquid fuel consumption, where the EIA says that liquid fuel consumption will grow from 19 million barrels per day in 2008 to 22 million per day in 2035, but that all growth this will be due to growth in the use of biofuels. Consumption of petroleum-based liquid fuels will remain flat.

The production of petroleum-based fuels is expected to increase in absolute terms, however, with much of this growth coming from increases in offshore and terrestrial production. Imported oil should decline significantly.

The electricity consumption of an increasing population is expected to grow by 1 percent per year, and most of the growth in carbon dioxide emissions can be attributed to the electric power, as well as transportation, sectors.

As the EIA points out, even without greenhouse gas policies in place, the peak of U.S. oil demand was likely in 2005, when demand reached 20.8 million barrels per day. Following the drop during the recession, biofuels will account for any rise in liquid fuel demand, the report states.

"We do not think it will go back to what previous levels have been," EIA chief Richard Newell said at a briefing Monday in Washington.

Greater Efficiency and Renewables

Even without emissions caps in place, technology and existing policies that encourage energy efficiency will have an important impact on energy consumption, the EIA says. The efficiency rate for vehicles, for example, is expected to rise from 2000’s 25 miles per gallon to 40 mpg in 2035. While the nation’s overall CO2 emissions from energy will rise, per capita emissions will fall.

The EIA also sees growth in electricity use slowing to 1 percent per year, though coal’s share of electricity production would only drop from 48.5 to 43.8 percent.

Similarly, current policies, largely at the state level, that encourage energy production from renewable sources are expected to have an impact, as renewable generation grows from nine percent of energy produced in 2008 to 17 percent in 2035. Renewables, especially biomass and solar, would make up 41 percent of increases in electricity production.

"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," Newell said.

Uncertainty for Businesses

But the inability of these projections to take into account emissions-reducing policies not yet in place underlines the uncertainty that troubles some businesses and others who depend on having reliable information about the future when making decisions.

Coca-Cola and Unilever became the latest businesses to publicly commit to cutting their own greenhouse gas emissions as they launched a joint report Friday illustrating "how consumer goods companies can tackle climate change" throughout the value chain and by affecting consumer behavior.

They are among the companies calling for a clear policy on emissions reductions. Though many businesses still remain fearful of climate change legislation or regulation, many others are more fearful of remaining in the current limbo where these policies are looming but not yet certain.

The stability that comes with firm policies in place would, they feel, allow for greater clarity regarding future decades, and thus more long-term investment.


See also:

US Declares Greenhouse Gases a Danger to Public Health and Welfare

New Climate Bill Framework Embraces GOP Energy Mantra: All of the Above

Deutsche Bank: Absence of US Clean Energy Policy Will Send Global Capital Elsewhere

Investors Tell Congress: Go Green Now and Private Investment Will Follow

Majority of Top Businesses Now Set Emissions Targets, But Still Seek Global Policy Direction