WORLD ENERGY REPORT: MORE, MORE, MORE

A new report from the Energy Information Administration (EIA), the Department of Energy’s statistics crunching office, predicts big increases in energy and fossil fuel consumption despite making one thing perfectly clear: The era of cheap oil is over.

The report predicts 2030 oil prices will be in the $113/barrel to $186/barrel range and says that the the $113/barrel figure translates to a $70/barrel 2006 price.

Guy Caruso, head, EIA: "We're not going back to the historically low prices we saw in the '80s and '90s…"

Though the report provides a range of oil prices for 2030, it indicates the higher price is more likely. The good news: Oil consumption would be 10 million barrels/day less at the higher prices (with concomitantly lower greenhouse gas emissions).

It should be noted that these numbers are based on an assumed 2030 world oil consumption of 113 million barrels/day but many oil world authorities believe the oil industry is not capable of anywhere near that kind of output.

The report predicts coal use will grow 2%/year, nuclear will grow 1/3 in a quarter century, natural gas and LNG will boom and New Energy for electricity generation will grow only 2.1%/year, mostly from hydroelectric projects.

BUT: The report assumes no mandatory action by the U.S. to cut GhGs. BOTH current presidential candidates favor instituting a cap-and-trade system to bring market forces to bear on GhG reductions and global climate change mitigation.

So consider this EIA report just another example of government waste.

From the EIA report. (click to enlarge)

Report sees big jump in energy, fossil fuel use
H. Josef Hebert, June 25, 2008 (AP)

WHO
Energy Information Administration (EIA) (Guy Caruso, head) of the U.S. Department of Energy (DOE) (Samuel Bodman, Secretary of Energy)

WHAT
International Energy Outlook 2008 from the EIA predicts that, in the absence of mandatory measures to curb GhG emissions, world energy demand will grow by 50% over the next quarter century with continued heavy use of oil and coal.

From the EIA report. (click to enlarge)

WHEN
- The EIA report forecasts energy patterns through 2030.
- 2030: World oil demand is predicted to be 113 million barrels/day (absent mandatory GhG reductions)

WHERE
- Energy demand in China and other emerging economies is predicted to grow 85% over the next quarter century.
- Without a mandatory intrusion into emissions habits, world coal consumption will grow 2%/year, 1.5% from China.

WHY
- The EIA report predicts that in the absence of mandatory changes in fossil fuel consumption patterns greenhouse gas (GhG) accumulations will be 51% higher in 2030 than they were in 2005.
The report predicts an increase in the use of wind and biofuels.
- The EIA analysis assumed oil prices from $113/barrel to $186/barrel in 2030. The $113/barrel price translates to a $70/barrel 2006 price, meaning the cost of oil will remain high but will not discourage increased consumption.
- “Unconventional” oil sources (shale, biofuels) will increase 10%.
- OPEC will retain its 40% oil market share.
- Nuclear energy will grow by one-third. The world will build 124 new nuclear power plants (China: 45; India: 17; Russia: 18; U.S.: 15) by 2030, increasing nuclear energy’s share of electricity generation by 1/3.
- Natural gas use will boom. Liquified natural gas (LNG) use will boom in the Middle East and Africa.

From the EIA report. (click to enlarge)

QUOTES
- Guy Caruso, head, EIA: "What jumps out is the very strong growth in the emerging economies…"
- EIA report: "Fossil fuels ... are expected to continue supplying much of the energy used worldwide…Global energy demand grows despite the sustained high world oil prices that are projected to persist over the long term…"
- Caruso: "[Coal is] the fuel of choice for electricity production in the emerging economies, especially China…"