Current Topics at EIA

Transcription

1 Richard Newell, USAEE, November 29 1 Current Topics at EIA U.S. Association for Energy Economics November 2, 29, Washington, DC Richard Newell, Administrator U.S. Energy Information Administration

2 Richard Newell, USAEE, November 29 2 Overview EIA mission U.S. natural gas developments Energy and Financial Markets Initiative Climate policy analysis

3 EIA mission, resources, and core functions Mission: Independent Statistics and Analysis EIA collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment. Current resources: $111 million; 375 FTEs EIA Budget by Function 32% Information Collection and Management 53% Analysis and Forecasting 15% Information Dissemination Richard Newell, USAEE, November 29 3

4 U.S. natural gas shale plays Richard Newell, USAEE, November 29 4

5 Horizontal shale gas rig counts slowed, but have rebounded Max Count Min Count Marcellus 15 Barnett 1 Woodford Haynesville 5 Fayetteville Jan-7 Mar-7 May-7 Jul-7 Sep-7 Nov-7 Jan-8 Mar-8 May-8 Jul-8 Sep-8 Nov-8 Jan-9 Mar-9 May-9 Jul-9 Sep-9 Nov-9 Richard Newell, USAEE, November 29 Source: Smith International 5

6 Production in key gas shale plays is growing rapidly Billion cubic meters * Marcellus Haynesville Woodford Fayetteville Barnett Antrim *Estimated Source: Energy Information Administration and Richard Newell, USAEE, November 29 Lippmann Consulting, Inc. 6

7 Year-end domestic gas reserves increased 3% in 28, despite higher production and lower prices Dry Natural Gas (Tcf) Tcf 1.2 Total Reserves Additions (3.1).9.2 (2.5) Proved Reserves 27 New Field Discoveries New Reservoirs in Old Fields Extensions 245 Tcf Net Revisions Net of Sales & Acquisitions Adjustments 28 Dry Gas Production Proved Reserves 28 Total Discoveries Richard Newell, USAEE, November 29 Source: Energy Information Administration 7

8 Richard Newell, USAEE, November 29 Source: Potential Gas Committee 8 New technologies also force a reassessment of gas resources PGC Resource Estimates (Tcf) 2, 1,8 1,6 1,4 1,2 1, Speculative Possible Probable

9 Henry Hub spot prices remain highly uncertain Dollars per million Btu History Henry Hub spot STEO Henry Hub forecast NYMEX futures prices 68% NYMEX confidence interval 95% NYMEX confidence interval Projections Jan-8 Jul-8 Jan-9 Jul-9 Jan-1 Jul-1 Jan-11 Richard Newell, USAEE, November 29 Source: EIA Short-Term Energy Outlook November 29 9

10 Expected near term WTI oil price is flat, but highly uncertain Dollars per million Btu WTI spot STEO WTI forecast NYMEX futures prices 68% NYMEX confidence interval 95% NYMEX confidence interval 2 18 History Projections Jan-8 Jul-8 Jan-9 Jul-9 Jan-1 Jul-1 Jan-11 Richard Newell, USAEE, November 29 Source: EIA Short-Term Energy Outlook November 29 1

11 Richard Newell, USAEE, November Oil prices relate to many uncertain factors Non-OPEC supply growth Inventories OPEC production decisions Spare production capacity Global Oil Prices Global economic growth Speculation, hedging, investment Geo-political risks Weather Exchange rates and inflation

12 EIA recently launched the Energy and Financial Markets Initiative to track all the factors affecting energy prices 1. Collection of critical energy information to improve market transparency Nov 2 Federal Register notice initiating additional petroleum storage capacity collection Forthcoming FR notice requesting views on additional data needs, particularly for clarifying relationship among inventories-prices-financials 2. Analysis of energy and financial market dynamics Oct rollout of implied volatility work Improving existing products; special reports on factors affecting prices 3. Outreach to experts and the public Nov 18 workshop; FR notices; Annual conference 4. Coordination with other Federal agencies Richard Newell, USAEE, November 29 12

13 Richard Newell, USAEE, November EIA Analysis of H.R.2454 The American Clean Energy and Security Act of 29

14 ACESA requires billion-metric-ton reduction in covered GHG emissions over ; actual reductions could be smaller or larger depending on the use of offsets and banking behavior CO 2 -equivalent emissions, billion metric tons Cumulative difference, = 24.6 BMT Use of Offsets =? BMT 2 1 Total Greenhouse Gas Emissions, Reference Case Covered Emissions, Reference Case Cap on Covered Emissions Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 14

15 Main cases in EIA s analysis Basic Case Name Assumptions Integrated analysis of all of the modeled provisions of ACESA. Zero Bank High Offsets High Cost No International No International / Limited Same as Basic but no carryover of allowances beyond 23. Proxy for major low- no-carbon energy technology breakthroughs with significant market impacts after 23 Same as Basic but assumes increased use of international offsets. Same as Basic but assumes that nuclear, fossil with CCS and biomass gasification costs are 5 % higher Same as Basic but assumes international offsets are too expensive or unable to meet the requirements for use Same as Basic but limits additions of nuclear, fossil with CCS and biomass to reference case levels. Also no international offsets. Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 15

16 Energy sector reductions (2 bottom sections) vary with availability of offsets and low-emitting generation options Cumulative compliance, (billion metric tons) Energy-Related CO2 Non-Energy-CO2 covered emissions Offsets, Noncovered emissions Required Abatement Carbon Capture and Storage Offsets, Biosequestration Offsets, International Basic Zero Bank High Offsets High Cost No International No Int'l/Lim ited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 16

17 Projected allowance prices depend on the availability of offsets and low/no carbon electricity generation technologies (27 dollars per metric ton CO 2 -equivalent) Basic Zero Bank High Offsets High Cost No International No Int / Limited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 17

18 The electricity sector dominates projected reductions in energy-related CO 2 emissions (million metric tons CO2) 6, 5, , 3, , 23 Electric Pow er Transportation Industrial Buildings , Reference Basic Zero Bank High Offsets High Cost No International No Int / Limited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 18

19 23 generation shifts from conventional coal to nuclear, renewables, and fossil+ccs; natural gas use grows dramatically if other options are limited (billion kilowatthours) Coal Coal w /CCS Oil Natural Gas Natural Gas w /CCS Nuclear Renew able 5, 4, 3, 2, 1, Reference Basic Zero Bank High Offsets High Cost No Interational No Int / Limited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 19

20 Electricity capacity additions dominated by mix of nuclear, renewables, fossil+ccs, but natural gas is larger if those options are limited (thousand megawatts) 6 Renewable Nuclear 5 Natural Gas with CCS Natural Gas 4 Coal with CCS 219 Coal Reference Basic Zero Bank High Offsets High Cost No International No Int / Limited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 2

21 Efficiency programs and higher electricity prices reduce electricity demand growth Annual percent growth in electricity use 3.% 2.5% 2.39% 2.% 27 to 23 Growth 1.5% 1.% 1.15%.9%.5%.64%.72%.72%.57%.56%.% 199 to 2 2 to 27 Reference Basic Zero Bank High Offsets High Cost No International.21% No Int / Limited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 21

22 Electricity prices stay near baseline through 225 in all but one case, then rise to higher levels through (27 cents per kilowatthour, all sectors average) Reference Basic Zero Bank High Offsets High Cost No International No Int / Limited Richard Newell, USAEE, November 29 Source: EIA Analysis of the American Clean Energy and Security Act of 29 22

23 Present-value GDP losses over range from.2% to.4%; consumption losses range from.1% to.3% in 5 analysis cases. Impacts are much higher in the No International/Limited Alternatives case. Richard Newell, USAEE, November Cumulative Change in Real GDP -736 Undiscounted Present 4% Basic Zero Bank High Offset High Cost No International No Int/Limited Cumulative Change in Real Consumption Undiscounted Present 4% Real GDP Reference Basic Zero Bank High Offset High Cost No International No Int/Limited Real Consumption Basic Zero Bank High Offset High Cost No International No Int/Limited Reference Basic Zero Bank High Offset High Cost No International No Int/Limited

24 Richard Newell, USAEE, November For more information Energy Information Administration home page Short-Term Energy Outlook Annual Energy Outlook International Energy Outlook Monthly Energy Review U.S. Energy Information Administration