Fuels Used in Electricity Generation

Transcription

1 Fuels Used in Electricity Generation for Energy and Climate Change Research Seminar May 17 th, 2012 Washington, DC by, Office of Electricity, Coal, Nuclear and Renewables Analysis Energy Information Administration U.S. Energy Information Administration Independent Statistics & Analysis

2 Key results from the AEO2012 Reference case, which assumes current laws remain unchanged Projected growth of energy use slows over the projection period reflecting an extended economic recovery and increasing energy efficiency in end-use applications Domestic crude oil production increases, reaching levels not experienced since 1994 by 2020 With modest economic growth, increased efficiency, growing domestic production, and continued adoption of nonpetroleum liquids, net petroleum imports make up a smaller share of total liquids consumption Natural gas production increases throughout the projection period and exceeds consumption early in the next decade Renewables and natural gas fuel a growing share of electric power generation Total U.S. energy-related carbon dioxide emissions remain below their 2005 level through

3 What is included (and excluded) in developing EIA s Reference case projections? Generally assumes current laws and regulations excludes potential future laws and regulations (e.g., proposed greenhouse gas legislation and proposed fuel economy standards are not included) provisions generally sunset as specified in law (e.g., renewable tax credits expire) Some grey areas adds a premium to the capital cost of CO 2 -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 3

4 Energy use grows slowly over the projection in response to a slow and extended economic recovery and improving energy efficiency U.S. primary energy consumption quadrillion Btu per year Shares of total U.S. energy History % 1% 25% Projections Renewables (excluding liquid biofuels) Liquid biofuels Natural gas 11% 4% 25% 60 9% Nuclear 9% 40 21% Coal 20% 20 37% Oil and other liquids 32% Source: EIA, Annual Energy Outlook 2012 Early Release 4

5 In 2010, U.S. electricity generation was 70% fossil fuels, 20% nuclear, and 10% renewable 2010 Total net generation: 4,120 billion kwh Other gases 0.3% Nuclear 19.6% Conventional hydroelectric 6.2% 2010 Non-hydro renewable net generation: 168 billion kwh Natural gas 23.8% Other 0.3% Other renewable 4.1% Wind: 2.3% Solar thermal and PV: <0.1% Wood and woodderived fuels: 0.9% Petroleum 0.9% Coal 44.9% Geothermal: 0.4% Other biomass: 0.5% Source: EIA, Annual Energy Review, October

6 While electricity consumption grows by 23% over the projection, the annual rate of growth slows percent growth (3-year rolling average) History 2010 Period Annual Growth 1950s s s s s Projections Source: EIA, Annual Energy Outlook 2012 Early Release 6

7 Electricity mix gradually shifts to lower-carbon options, led by growth in renewables and natural gas electricity net generation trillion kilowatthours per year 6 History 2010 Projections % 10% Natural gas Renewables 27% 16% 2 45% Coal 39% 1 Oil and other liquids 20% Nuclear 18% 1% 0 1% Source: EIA, Annual Energy Outlook 2012 Early Release 7

8 The fuel mix for electricity generation by region (2010 ) Share of Generation by Fuel, 2010 National Average Minimum Maximum Coal 45% 0% 80% Natural Gas 24% 3% 85% Nuclear 20% 0% 40% Renewables 10% 0% 50% Oil / Other 1% 0% 8% Source: EIA AEO2012 (Early Release), based on Form EIA-923 8

9 The fuel mix for electricity generation by region (2035) Share of Generation by Fuel, 2035 National Average Minimum Maximum Coal 39% 0% 71% Natural Gas 27% 4% 77% Nuclear 18% 0% 38% Renewables 16% 1% 60% Oil / Other 1% 0% 12% Source: EIA AEO2012 (Early Release) 9

10 Non-hydro renewable sources more than double between 2010 and 2035 non-hydropower renewable generation billion kilowatthours per year 500 History 2010 Projections Advanced biofuels cogeneration Power sector Industrial CHP Biomass Wind 100 Geothermal 0 Waste Source: EIA, Annual Energy Outlook 2012 Early Release Solar 10

11 EIA s natural gas price projections are slightly lower than in AEO2011, consistent with recent market developments natural gas spot price (Henry Hub) 2010 dollars per million Btu 10 History 2010 Projections Sources: EIA, Annual Energy Outlook 2012 Early Release and EIA, Annual Energy Outlook

12 Shale gas offsets declines in other U.S. natural gas production sources U.S. dry gas production trillion cubic feet per year 30 History 2010 Projections % Shale gas 49% 15 26% Tight gas 21% 10 9% Non-associated offshore 2% 9% Coalbed methane 7% 10% 5 Associated with oil Alaska 1% 7% 7% 21% Non-associated onshore 9% Source: EIA, Annual Energy Outlook 2012 Early Release 12

13 Domestic natural gas production grows faster than consumption U.S. dry gas trillion cubic feet per year 30 History 2010 Projections Consumption Domestic supply Net imports Source: EIA, Annual Energy Outlook 2012 Early Release 13

14 Technically recoverable natural gas resources reflect updated assessments U.S. dry gas resources trillion cubic feet Unproved shale gas Unproved other gas (including Alaska* and offshore) Proved reserves (all types and locations) 2, , AEO Edition *Alaska resource estimates prior to AEO2009 reflect resources from the North Slope that were not included in previously published documentation. Source: EIA, Annual Energy Outlook 14

15 The average delivered price of coal to electricity generators varies widely across U.S. regions transport costs are a key reason 2010 Delivered coal prices, $ per million Btu $3.41 $2.02 $2.01 $2.96 $1.51 $1.49 N/A N/A 1.77 $1.57 $1.46 $1.75 $2.48 $2.91 $1.93 $1.83 $1.83 $2.45 $3.40 $3.65 National Average Minimum Maximum $2.25 $1.46 $4.46 $1.91 $4.46 Source: EIA, Annual Energy Outlook 2012 Early Release 15

16 Operating costs: existing plants with and without a value on carbon Fuel Cost for Existing Coal and Combined Cycle Natural Gas Units with a Value Placed on Carbon Dioxide Emissions 2010 dollars per megawatthour Natural Gas CC at $7 Coal at $2 Coal at $3 Natural Gas CC at $3 Natural Gas CC at $ Carbon Dioxide Value (dollars per ton CO 2 ) The crossover point for least-cost dispatch of coal and natural gas capacity depends on both fuel prices and the carbon value. At lower natural gas prices, the crossover occurs at a lower carbon value. Environmental operating costs and retrofit costs for pollution controls at existing coal-fired plants can raise the bar for their continued operation. For retrofit decisions, the unit s perceived useful life, which plays a critical role, can be affected by views regarding future climate policies 16

17 Why might could will we be wrong? Changing policies and regulations Changing consumer preferences Faster / slower economic growth Faster / slower technological progress Different relative fuel prices Technological breakthroughs 17

18 For more information U.S. Energy Information Administration home page Annual Energy Outlook Short-Term Energy Outlook International Energy Outlook Monthly Energy Review Annual Energy Review 18